The  Soldiers  and  Sailors 
Insurance  Act 


A    DISSERTATION 

Submitted  to  the  Faculty  of  Philosophy  of  the  Catholic 

University  of  America  in  Partial  Fulfilment 

of  the  Requirements  for  the  Degree 

of  Doctor  of  Philosophy. 


By 
JAMES  A;  LOSTY,  M.  A. 


EXCHANGE 


The  Soldiers  and  Sailors 
Insurance  Act 


A    DISSERTATION 

Submitted  to  the  Faculty  of  Philosophy  of  the  Catholic 

University  of  America  in  Partial  fulfillment 

of  the  Requirements  for  the  Degree 

of  Doctor  of  Philosophy. 


By 

JAMES  A.  LOSTY,  M.  A. 

1921 


A 


SXCHANOR 


FOREWORD 

In  this  monograph  the  writer  has  made  an  effort  to 
analyze  the  various  ramifications  of  the  Soldiers  and  Sailors 
Insurance  Act.  Most  of  the  facts  on  which  the  analysis  and 
conclusions  set  forth,  are  based  on  the  result  of  an  original 
investigation  made  while  the  writer  was  employed  in  the 
Bureau  of  War  Risk  Insurance.  It  is  to  be  hoped  that  this 
work  will  be  helpful  not  only  to  persons  interested  in  the 
administration  of  Allotments  and  Allowances,  Compensation, 
and  Insurance  by  the  Federal  Government,  but  also  to  stu- 
dents of  Social  Insurance  generally. 

The  writer  desires  to  express  his  thanks  to  the  officials  of 
the  Bureau  of  War  Risk  Insurance,  who  have  assisted  by 
their  aid  and  criticism.  He  desires  especially  to  thank  the 
Professors  of  the  Catholic  University  under  whose  direction 
this  investigation  was  conducted. 

J.  A.  L. 

s 

L. 


CONTENTS 

PAGE 

Introduction     .          .          .          .          .          .          .          .7 

CHAPTER  I 
Allotments  and  Allowances       .....         9 

CHAPTER  II 
Compensation  .......       25 

CHAPTER  III 
Medical  Care  and  Treatment       .          .          .          .          .41 

CHAPTER  IV 
Pensions  in  the  United  States  and  Foreign  Countries  .       48 

CHAPTER  V 
Insurance          ........       58 

CHAPTER  VI 
Reinstatement  and  Conversion  of  Government  Insurance       66 

CHAPTER  VII 
Organization     ........       75 

Conclusion  ........  81 

Biography 87 

Bibliography  ........  87 

Appendix  ...  88 


INTRODUCTION 

With  the  declaration  by  Congress  on  April  6,  1917,  of  a 
state  of  war  with  the  Imperial  German  Government,  the 
United  States  implicitly  assumed  obligations,  the  magnitude 
of  which  she  did  not  then  appreciate.  These  obliga- 
tions were  many  and  diversified;  their  ramifications  ex- 
tended into  many  phases  of  our  national  life.  It  will  not 
be  necessary  for  the  writer  to  recount  them  all.  It  will  serve 
his  purpose  if  he  merely  mentions  some  of  the  more  impor- 
tant ones. 

The  common  opinion  in  the  early  days  of  the  war  among 
all  classes,  with  the  possible  exception  of  those  very  well  in- 
formed, was  that  America's  participation  in  the  struggle 
was  to  be  of  an  economic  nature  only.  The  United  States 
was  the  storehouse  of  the  world's  supply  of  gold.  Our  in- 
dustrial life  had,  for  a  long  time,  been  on  a  wartime  basis, 
and  we  had  become  Europe's  arsenal  and  munitions  plant. 
It  was  natural  for  the  American  people  to  presume  that  the 
Allies  were  eager  to  secure  only  our  economic  support.  In 
a  short  time,  however,  the  people  awoke  to  the  realization 
that  we  would  have  to  mobilize  our  military,  as  well  as  our 
economic,  resources. 

When  the  nature  of  our  support  had  been  determined 
upon,  the  question  of  ways  and  means  arose.  Laws  had  to 
be  enacted  which  would  provide  for  the  raising  of  an  ade- 
quate fighting  force  and  for  the  financing  of  our  wartime 
operations.  After  much  debate  in  the  Halls  of  Congress  the 
Selective  Service  Act  was  passed.  This  Act  provided  the 
necessary  machinery  for  the  raising  of  a  large  citizen  army. 
The  adoption  by  Congress  of  a  system  of  excess  profits  and 
luxury  taxes,  in  addition  to  popular  subscription  loans,  pro- 
vided means  for  the  raising  of  the  necessary  funds. 

When  the  Selective  Service  Act  went  into  effect  a  new 
problem  arose — the  problem  of  financial  support  for  the  de- 
pendents of  those  men  who  would  be  called  into  military 
service.  In  addition,  a  system  of  indemnification  had  to  be 
devised  to  protect  those  who  might  suffer  injury  while  in 
the  service  and  to  provide  for  the  dependents  of  those  called 
upon  to  make  the  supreme  sacrifice  on  the  battlefield.  Fur- 
thermore, the  Government  was  under  the  obligation  of  re- 
storing the  insurability  at  ordinary  rates  of  all  men  called 
into  the  service  during  the  war. 

These  obligations  were  met  by  the  passage  of  the  Military 
and  Naval  Insurance  Act  of  October  6,  1917,  an  amendment 


to  the  War  Risk  Insurance  Act  of  September  2,  1914.1  As 
this  Act  of  October  6,  1917,  only  provided  benefits  for  our 
soldiers,  sailors,  marines,  and  their  dependents,  the  writer 
has  chosen  the  more  significant  title,  "The  Soldiers  and 
Sailors  Insurance  Act." 

This  Act  of  October  6,  1917,  provided,  in  brief,  the 
following : 

1.  For  the  support  during  the  war  of  the  families  and 
dependents  of  enlisted  men  by  means  of:  (a)  Allotments  of 
pay,  viz.:  certain  portions  of  a  man's  pay  were  withheld  and 
paid  directly  to  his  family  or  dependents;  (b)  Family  allow- 
ances— money  granted  by  the  Government  to  a  wife,  a  child, 
and  certain  dependents,  provided  an  allotment  had  been 
made  in  their  favor. 

2.  For  the  protection,  by  means  of  compensation  of  all 
officers,  female  nurses,  and  enlisted  personnel  and  their  de- 
pendents, against  the  hazards  of  injury,  disease,  and  death. 
This  compensation  is  payable  monthly  for  disability  or  death 
due  to  injury  or  disease  incurred  or  contracted  in  line  of 
duty. 

3.  For  insurance,  at  peace  time  rates,  against  permanent 
and  total  disability  and  death,  for  all  officers,  female  nurses, 
and  enlisted  personnel. 

The  Director  of  the  Bureau  of  War  Risk  Insurance  was 
given  full  power  and  authority  to  administer,  execute,  and 
enforce  all  the  provisions  of  the  Act,  except  as  otherwise 
provided  for  in  the  Act.  The  Director  was  and  is  subject 
to  the  general  direction  of  the  Secretary  of  the  Treasury. 

The  original  appropriations  for  the  operation  of  this  Act 
were  as  follows:  $100,000  for  the  payment  of  all  expenses 
incident  to  the  work  authorized;  $141,000,000  for  the  pay- 
ment of  family  allowances;  $12,150,000  for  the  payment  of 
compensation,  funeral  expenses,  medical  services,  and  sup- 
plies; and  $23,000,000  for  the  payment  of  any  insurance  lia- 
bilities which  might  arise. 

The  aim  of  the  Act  was  threefold.  Since  it  was  naturally 
divided  into  three  sections — Allotments  and  Allowances, 
Compensation,  and  Insurance — it  appears  advisable  to  ex- 
amine its  interpretation  and  operation  in  the  same  order. 

1  The  War  Risk  Insurance  Act  as  passed  on  September  2,  1914,  provided 
Government  insurance  against  war  risks  on  American  vessels,  cargoes  and 
freight.  In  June,  1917,  this  Act  was  amended  for  the  purpose  of  affording 
protection  to  masters,  officers  and  crews  of  American  vessels.  For  this  marine 
and  seamen's  insurance  Congress  appropriated  the  sum  of  $50,000,000  to  pay 
the  losses  that  might  arise  However,  this  sum  was  not  used,  as  all  losses  and 
the  expenses  of  operation  were  paid  from  the  premiums  received.  In  fact, 
there  was  a  surplus  of  $17,000,000  in  the  receipts  over  the  disbursements. 
After  the  armistice  was  signed  and  the  seas  were  cleared  of  mines,  the  need 
for  this  insurance  was  at  an  end  and  the  business  was  terminated  on  January 
4,  1919,  by  order  of  the  Secretary  of  the  Treasury. 

8 


I 

ALLOTMENTS  AND  ALLOWANCES 

The  aim  and  purpose  of  Article  II  of  the  Soldiers  and 
Sailors  Insurance  Act  was  to  provide  financial  assistance  for 
the  dependents  of  all  enlisted  men  in  the  military  or  naval 
service  of  the  United  States  during  the  Great  War.  It  be- 
came obligatory  for  the  Federal  Government  to  render  such 
assistance  after  the  enactment  by  Congress  of  the  Selective 
Service  Act.  It  is  apparent  to  all  that  large  bodies  of  men 
could  not  be  freed  from  their  marital  obligations  and  called 
into  the  military  service  of  the  nation  unless  some  provisions 
were  made  for  the  support  of  their  dependents. 

The  Article  provided  that  every  enlisted  man  having  a 
wife,  a  common-law  wife,  a  divorced  wife  to  whom  the  courts 
had  granted  alimony,  a  child,  a  step-child,  or  an  illegitimate 
child,  upon  entering  the  service,  must  make  an  allotment  in 
their  favor.  Such  an  allotment  must  equal  one-half  of  the 
allottor's  pay,  but  in  no  case  could  it  be  less  than  $15.00  a 
month.  Any  man  could  allot  more  than  this  amount,  but 
he  could  not  assign  less.  Because  of  promotions  and  varia- 
tions in  the  pay  of  the  non-commissioned  personnel,  the 
original  Act  was  amended  so  that  after  July  1,  1918,  a  flat 
allotment  of  $15.00  a  month  was  required  of  all  married  men. 
Such  an  allotment  had  to  be  made  whether  a  man's  relatives 
were  dependent  on  him  or  not.  There  were  some  exceptions 
to  this  general  rule,  which  will  be  explained  later. 

An  enlisted  man  having  performed  this  primary  duty 
towards  his  family,  the  Government  was  ready  and  willing 
to  add  an  allowance.  The  Government  by  such  allowances 
aimed  to  grant  a  measure  of  justice  on  behalf  of  the  whole 
people  and  in  such  a  manner  as  would  hearten  all  men  with 
dependents  who  were  called  into  the  service.  The  amount 
of  the  allowance  was  determined  by  the  family  relationship 
of  the  recipient  and  the  number  of  the  allottor's  dependents. 
The  schedule  given  below  will  show  the  allowances  pro- 
vided. In  no  case  could  the  total  of  the  allowances  claimed 
by  the  relatives  of  one  man  exceed  the  statutory  maximum 
of  $50.00  a  month. 

9 


SCHEDULE  OF  CLASS  A.  "ALLOTMENTS  AND  GOVERNMENT  ALLOWANCES 

Total 
Allotment    Allowance    Monthly 

For  a  wife  only $15.00  $15.00  $30.00 

For  a  wife  and  one  child. 15.00  25.00  40.00 

For  a  wife  and  two  children. 15.00  32.50  47.50 

For  a  wife  and  three  children 15.00  37.50  52.50 

For  a  wife  and  four  children. 15.00  42.50  57.50 

For  a  wife  and  five  children ._ 15.00  47.50  62.50 

For  a  wife  and  six  children .._  15.00  50.00  65.00 

For  one  motherless  child 15.00  5.00  20.00 

For  two  motherless  children 15.00  12.50  27.50 

For  three  motherless  children 15.00  20.00  35.00 

For  four  motherless  children 15.00  30.00  45.00 

For  five  motherless  children 15.00  35.00  50.00 

For  six  motherless  children 15.00  40.00  55.00 

For  seven   motherless   children 15.00  45.00  60.00 

For  eight  motherless  children 15.00  50.001  65.00 

Some  criticism  was  made  of  the  amount  and  of  the  in- 
elasticity of  the  allowances  provided — criticism  which  ap- 
peared just  to  the  casual  observer,  since  it  was  a  known  fact 
that  the  cost  of  living  varied  in  different  sections  of  the 
country.  From  different  surveys  made,  it  has  been  proven 
that  it  cost  more  to  maintain  a  family  in  a  large  city  than 
it  did  in  a  small  rural  community.  It  must  be  admitted,  at 
least  theoretically,  that  this  fact  should  have  been  taken  into 
consideration  by  Congress,  but  anyone  familiar  with  our 
national  legislative  body  will  realize  that  it  would  have  been 
practically  impossible  to  secure  the  passage  of  an  act  em- 
bodying a  varying  schedule  of  allowances.  We  must  bear 
in  mind  that  this  Act  was  a  Federal  Act,  and  as  such  its 
provisions  and  grants  had  to  be  uniform  as  well  as  uni- 
versal. The  fund  from  which  these  allowances  were  paid 
was  drawn  from  the  Federal  Treasury,  and  it  was  collected 
by  a  uniform  and  universal  system  of  taxation.  Since  the 
grants  provided  had  to  be  uniform  as  well  as  universal,  they 
were  determined  by  the  average  cost  of  living  throughout 
the  United  States.  These  allowances  were  not  intended  to 
be  sufficient  to  maintain  each  family  in  the  same  comfort- 
able circumstances  to  which  it  had  been  accustomed;  but 
they  did  provide  sufficient  means  for  the  actual  maintenance 
of  such  families. 

When  Article  II  of  the  Act  went  into  operation,  the  first 
and  most  important  question  to  be  determined  was:  What 
proof  shall  be  required  to  establish  a  title  to  an  allowance? 
Ordinary  forms  of  evidence  to  prove  the  existence  of  mar- 
riage, date  of  birth,  and  relationship  could  have  been  de- 
manded, but  such  procedure  would  have  caused  great  delays 

1  Maximum  allowance  granted  to  the  dependents  of  one  man. 

10 


and  unnecessary  expense  to  prospective  beneficiaries. 
Therefore,  in  order  to  secure  the  necessary  information  and 
proof,  a  simple  allotment  application  blank  was  provided 
by  the  Government.  This  form  was  drawn  up  so  that  the 
correct  execution  of  it  by  an  enlisted  man  would  furnish 
the  Bureau  with  all  necessary  information  in  each  case. 

Although  the  allowances  granted  by  the  Act  were  simple 
in  statement  and  the  Bureau  issued  interpretations  of  the 
Act,  many  complications  arose  in  its  operation.  To  illus- 
trate the  manner  in  which  the  law  actually  did  operate,  it 
has  been  deemed  advisable  to  cite  typical  cases.  We  shall 
first  explain  the  procedure  in  ordinary  cases,  and  then  take 
up  the  exceptional  ones. 

The  following  case  will  serve  to  show  the  manner  in  which 
the  Act  operated  ordinarily.  A  man  having  a  wife  and  child 
was  drafted  and  sent  to  camp.  According  to  the  law,  he 
was  required  to  make  an  allotment  of  $15.00  a  month  from 
his  pay  in  favor  of  his  wife  and  child.  The  soldier  in  this 
case  made  the  required  allotment  and  requested  that  his 
wife  and  child  be  granted  the  usual  Government  allowance. 
In  order  that  his  dependents  might  promptly  receive  his 
allotment  and  the  Government  allowance,  he  was  required 
to  give  certain  information  on  his  application.  This  included 
the  Christian  name  of  his  wife,  her  age,  the  date  of  his  mar- 
riage, and  her  mail  address,  the  name  of  his  child,  its  age, 
name,  and  the  address  of  its  custodian.  His  application 
bearing  this  information  was  then  accepted  by  his  command- 
ing officer,  who  instituted  checkage  for  $15.00  a  month 
against  his  pay.  It  was  then  forwarded  to  the  Bureau  of 
War  Risk  Insurance. 

All  information  on  this  application  being  correct,  and  the 
law  having  been  complied  with,  it  was  a  simple  matter  for 
the  Bureau  to  grant  an  award  to  the  wife  and  child.  This 
award  consisted  of  the  soldier's  allotment  of  $15.00,  the  Gov- 
ernment allowance  of  $15.00  for  the  wife  and  $10.00  addi- 
tional for  the  child,  a  total  of  $40.00  a  month.  A  check  for 
this  amount  was  mailed  each  month  to  the  wife.  When  her 
husband  was  discharged  from  the  service,  the  allotment  auto- 
matically terminated,  since  the  man's  pay  had  stopped. 
However,  the  Government  allowance  of  $25.00  was  continued 
for  one  month  after  the  date  of  this  soldier's  discharge. 

From  the  above  description  and  the  simple  language  of 
the  Act,  it  would  appear  that  there  could  be  few,  if  any,  diffi- 
culties associated  with  the  granting  and  awarding  of  allot- 
ments and  allowances.  Nevertheless,  there  were  many,  and 
they  caused  delays  which  often  resulted  in  working  hard- 
ships on  many  wives  and  children.  The  following  case  will 
serve  as  an  example: 

11 


A  man  in  Chicago  having  a  wife  and  two  children  was 
called  into  the  military  service.  After  his  departure  his 
wife  decided  to  sacrifice  her  home  and  to  enter  some  pro- 
ductive occupation,  in  order  to  do  her  part  in  the  prosecu- 
tion of  the  war.  That  her  two  children  might  receive  the 
benefit  of  a  home  life,  she  placed  them  in  the  custody  of  the 
enlisted  man's  mother.  In  the  meantime,  the  husband  had 
made  out  his  allotment  and  allowance  application,  giving 
the  Christian  names  of  his  wife  and  children  and  the  ad- 
dress of  his  home  in  Chicago.  When  his  application  was  re- 
ceived at  the  Bureau,  it  was  presumed  that  the  address  on 
the  application  was  the  present  address  of  the  wife  and  chil- 
dren. Since  it  was  understood  that  the  children  were  liv- 
ing with  the  wife,  the  entire  allotment  and  allowance  was 
sent  to  her.  The  wife  accepted  the  check,  believing  that  the 
grandmother  would  receive  an  allowance  from  the  Govern- 
ment for  the  support  of  the  children.  In  a  few  months  the 
Bureau  received  a  complaint  from  the  grandmother  to  the 
effect  that  she  had  not  received  the  allowance  to  which  her 
grandchildren  were  entitled.  The  Bureau  was  forced  to 
suspend  all  payments  to  the  wife  and  to  institute  an  investi- 
gation. When  the  payments  to  the  wife  were  suspended, 
she  complained  to  the  Bureau,  and  even  wrote  to  her  hus- 
band, rebuking  him  for  stopping  her  allotment.  A  general 
misunderstanding  and  delay  followed.  The  difficulty  was 
only  cleared  up  by  the  grandmother  filing  an  affidavit  to  the 
effect  that  the  children  were  in  her  care  and  custody.  Upon 
the  receipt  of  this  affidavit,  the  Bureau  requested  the  wife 
to  pay  the  grandmother  the  money  which  she  had  accepted, 
but  which  actually  belonged  to  her  children.  The  wife  was 
unable  to  do  this,  so  the  only  course  which  the  Bureau  could 
pursue  was  to  stop  all  payments  to  the  wife  until  the  total 
of  such  payments  due  her  equaled  the  sum  due  the  grand- 
mother for  the  children.  The  wife  suffered  during  this  pe- 
riod because  she  was  unable  to  maintain  the  same  standard 
of  living  which  had  been  made  possible  by  the  entire  allot- 
ment and  allowance.  When  payments  were  resumed,  the 
wife  received  a  check  for  6/13  of  her  husband's  allotment 
of  $15.00  or  $6.92,  plus  a  wife's  allowance  of  $15.00.  The 
remaining  7/13  of  the  allotment,  plus  an  allowance  of  $17.50 
(for  two  children),  was  paid  to  the  grandmother,  their  ac- 
tual custodian. 

Who  was  at  fault  in  this  case — the  Bureau  of  War  Risk, 
the  grandmother,  the  wife,  or  the  enlisted  man?  The  Bu- 
reau was  not,  since  it  had  acted  on  the  information  furnished 
by  the  soldier  on  his  application  blank;  the  grandmother 
cannot  be  criticized  for  asking  for  the  children's  share,  since 
she  was  supporting  them;  the  wife  was  ignorant  of  the  law 

12 


and  had  accepted  the  monthly  check  in  good  faith,  as  it  was 
made  out  to  her,  and  certainly  the  soldier  himself  cannot  be 
blamed  for  the  complication. 

From  the  above  case,  it  is  evident  that  the  Government 
was  determined  that  the  dependents  of  any  man  called  into 
the  service  should  not  be  left  destitute.  The  administrators 
of  the  law  insisted  that  allowances  provided  for  children 
should  be  paid  to  the  actual  custodian  or  guardian.  When- 
ever the  children  of  an  enlisted  man  were  not  in  the  custody 
of  his  wife,  both  their  share  of  his  allotment  and  the  Govern- 
ment allowance  was  apportioned.  In  all  cases  separate 
checks  were  made  out  for  the  wife  and  to  the  custodian  of 
the  children.  By  this  procedure  the  children  of  a  negligent 
mother  were  assured  of  a  portion  of  their  father's  allotment 
and  their  entire  Government  allowance. 

In  the  case  of  a  wife  who  was  separated  (but  not  divorced) 
from  her  husband,  previous  to  his  enlistment,  and  who  had 
been  granted  a  certain  monthly  sum  by  the  courts  or  by 
mutual  agreement,  the  apportionment  of  the  allotment  be- 
tween the  wife  and  any  children  was  governed  by  the  court 
decree.  That  is,  the  wife  received  only  a  sum  equivalent  to 
the  amount  designated  by  the  court.  In  the  event  that  this 
specified  sum  exceeded  her  apportionment  of  the  allotment, 
the  Government  allowance  was  added;  but  under  no  cir- 
cumstance could  she  receive  any  of  the  allotment  that  was 
due  the  children.  The  following  case  will  serve  to  illustrate 
this  point.  Let  us  suppose  that  the  mother  of  two  children 
had  been  granted  a  separation  allowance  of  $15.00  a  month 
from  her  husband.  At  a  later  date,  her  husband  was  called 
into  the  military  service.  Being  a  married  man,  he  was  re- 
quired to  make  an  allotment.  On  his  application  he  stated 
that  he  was  separated  from  his  wife,  but  that  he  had  been 
ordered  by  the  court  to  contribute  $15.00  a  month  towards 
her  support.  He  further  stated  that  his  children  were  not 
in  the  custody  of  his  wife,  but  in  an  orphanage.  How  much 
of  his  allotment  was  his  wife  entitled  to,  and  how  large  an 
allowance?  Since  there  were  two  children  in  this  case,  the 
wife  was  only  entitled  to  6/13  of  the  $15.00  allotment,  or 
$6.92.  Was  she  entitled  to  the  $15.00  allowance  granted  to 
wives  under  the  Act?  No,  since  her  apportionment  of  the 
allotment,  $6.92,  added  to  a  wife's  allowance  of  $15.00  a 
month  would  amount  to  $21.92,  or  $6.92  more  than  the  court 
had  granted  her.  What  she  would  receive  would  be  an  allot- 
ment of  $6.92,  plus  an  allowance  of  $8.08,  which  would 
equal  the  amount  decreed  by  the  court.  The  surplus  of  the 
allowance  could  not  be  paid  to  the  children,  but  reverted  to 
the  Government. 

No  service  man  was  obliged  to  make  an  allotment  to  his 

13 


divorced  wife  unless  she  had  been  granted  alimony  by  the 
courts.  If  the  alimony  granted  amounted  to  $15.00  a  month 
or  more,  the  enlisted  man  was  required  to  make  an  allot- 
ment of  $15.00  a  month.  If  the  decree  called  for  more  than 
$15.00  a  month,  the  Government  paid  the  difference,  provided 
it  did  not  exceed  the  maximum  allowance  of  $15.00  a  month 
allowed  a  wife.  To  be  specific,  the  maximum  allotment  and 
allowance  payable  to  a  divorced  woman  was  $30.00  a  month. 

Now,  if  a  divorced  man  had  been  freed  by  the  courts  from 
the  obligation  of  supporting  his  children,  who  were  given 
into  the  custody  of  his  divorced  wife,  was  he  required  to 
make  an  allotment  in  their  favor?  He  was,  since  the  Act 
of  October  6,  1917,  made  no  stipulation  or  condition,  except 
through  waiver,  whereby  the  children  of  an  enlisted  man 
could  be  deprived  of  an  allotment  from  their  father's  pay. 

This  is  in  direct  contrast  with  the  rights  of  a  wife,  for 
Section  201  of  the  Act  expressly  provides,  that  where  the 
wife  is  divorced  and  the  courts  have  not  granted  her  ali- 
mony, the  husband,  though  he  be  an  enlisted  men,  need  not 
make  an  allotment  of  his  pay  in  her  favor.  However,  there 
is  no  such  exception  made  respecting  a  man's  children.  It 
is  evident  that  the  right  to  a  compulsory  allotment  was  one 
of  relationship  and,  although  the  relationship  of  husband 
and  wife  may  be  terminated  by  law,  the  Bureau  held  that 
the  relationship  of  father  and  child  could  not  be  so  severed. 

In  awarding  an  allotment  and  allowance  to  an  orphan 
child,  particular  attention  had  to  be  paid  to  the  relationship 
and  domicile  of  the  payee.  Many  men  were  careless  about 
furnishing  adequate  information  as  to  the  actual  custodians 
of  their  children.  This  carelessness  caused  delays  in  the 
payment  of  allotments  and  allowances  to  those  charged  with 
the  care  of  such  children.  It  was  often  necessary  for  the 
Bureau  to  communicate  with  the  father  in  order  to  secure 
full  information  as  to  the  exact  address  and  relationship  of 
the  individual  in  whose  care  he  had  placed  his  child  or  chil- 
dren. If  this  procedure  failed  or  a  protracted  delay  oc- 
curred, a  communication  was  addressed  to  the  child  with 
instructions  for  the  custodian  or  guardian  to  follow.  If  this 
person  furnished  the  information  and  proof  of  guardianship 
requested,  an  award  was  made  to  him  for  the  child. 

As  many  children  were  born  after  the  enlistment  of  the 
father,  it  became  necessary  to  adopt  regulations  whereby 
they  could  receive  the  benefits  provided  by  the  Act.  Owing 
to  the  fact  that  the  majority  of  our  soldiers  were  sent  over- 
seas shortly  after  their  enlistment,  it  became  necessary  for 
the  Bureau  to  accept  such  proof  of  the  relationship  of  these 
children  as  the  mothers  were  able  to  furnish.  Proof  of  re- 
lationship could  be  established  by  a  birth  certificate,  a  bap- 

14 


tismal  record,  or  by  the  affidavits  of  two  witnesses  who  knew 
both  parents.  The  statement  of  the  attending  physician  or 
midwife  was  acceptable. 

Whenever  a  mother  claimed  an  allowance  for  a  child  born 
before  the  father  entered  the  service,  mention  of  which  child 
had  been  neglected  when  the  father  filed  his  allotment  and 
allowance  application,  evidence  of  the  highest  sort  was 
required.  This  had  to  be  in  the  form  of  a  public  birth  cer- 
tificate, or  an  affidavit  from  the  attending  physician.  In 
addition,  the  enlisted  man  was  required  to  execute  a  new 
application,  naming  the  child  as  a  beneficiary. 

The  law  provided  the  same  allowance  for  an  illegitimate 
child  as  one  born  in  lawful  wedlock.  If  the  father  of  such 
a  child  recognized  it  and  made  an  allotment  in  its  favor,  the 
Bureau  granted  it  the  usual  allowance.  If  the  father  neg- 
lected to  make  an  allotment  to  such  a  child,  the  mother 
could  compel  him  to  do  so,  if  she  was  able  to  produce  a 
written  statement  wherein  the  soldier  or  sailor  acknowledged 
the  parentage  of  the  child.  Whenever  such  a  mother  could 
secure  an  order  from  a  court  designating  the  enlisted  man 
as  the  father  of  the  child,  it  was  accepted  as  prima  facie  evi- 
dence. When  such  evidence  was  presented,  the  Bureau 
communicated  with  the  man's  commanding  officer  and 
checkage  for  an  allotment  was  made.  This  policy,  in  all 
probability,  did  a  great  deal  towards  protecting  the  morals 
of  our  different  communities  during  the  war,  especially 
those  wherein  large  bodies  of  men  were  concentrated. 

A  step-child  was  entitled  to  an  allowance,  provided  it  was 
a  member  of  the  enlisted  man's  household  and  dependent 
upon  him.  However,  should  the  mother  of  such  a  child  and 
the  step-father  (the  enlisted  man),  be  separated,  and  the 
child  be  in  the  custody  of  the  mother,  it  was  not  entitled  to 
an  allowance.  This  rule  held  whether  the  separation  was 
due  to  the  fault  of  the  mother  or  the  father. 

From  the  foregoing,  it  is  apparent  that  the  Bureau  granted 
allowances  to  dependents  whenever  it  was  legally  possible 
to  do  so.  In  fact,  it  did  more  than  the  law  actually  required 
of  it.  It  aided  many  deserted  wives  and  children  in  secur- 
ing some  financial  assistance  from  negligent  or  irresponsible 
fathers  and  husbands.  Many  men,  when  filing  their  allot- 
ment blanks  (all  were  required  to  at  least  execute  such 
blanks,  whether  they  had  dependents  or  not)  denied  that 
they  had  any  relatives  to  whom  they  were  required  to  make 
an  allotment.  As  many  appeals  came  to  the  Bureau  from 
neglected  women  and  children,  it  became  necessary  to  ar- 
range a  special  application  form  on  which  they  could  claim 
an  allotment  and  secure  an  allowance.  These  claims  were 
not  exceptional,  but  ran  into  the  thousands. 

15 


When  such  an  application,  properly  filled  out,  was  re- 
ceived, it  was  necessary  to  identify  and  locate  the  negligent 
father  or  husband.  This  was  extremely  difficult  but  abso- 
lutely necessary.  It  was  difficult  because  the  information 
given  by  the  claimant  was  often  meager  and  uncertain; 
moreover,  even  with  the  exact  information,  it  was  a  long  and 
tedious  task  to  trace  a  man  who  had  been  in  the  service 
three  months  or  more.  This  will  be  readily  appreciated  by 
anyone  familiar  with  the  manner  in  which  men  in  the  serv- 
ice were  transferred  from  organization  to  organization. 
Nevertheless,  the  Bureau  had  to  locate  these  men,  in  order 
that  proper  checkage  for  compulsory  allotments  might  be 
made  against  their  pay.  Such  checkage  was  necessary  be- 
cause an  allotment  was  that  portion  which  the  soldier  or 
sailor  was  required  to  contribute  from  his  pay.  Further- 
more, the  Act  specified  that  an  allowance  could  be  paid  only 
if  an  allotment  had  been  made. 

In  cases  where  a  commanding  officer  was  notified  that  a 
man  in  his  organization  had  relatives  entitled  to  a  compul- 
sory allotment,  and  such  an  officer  neglected  to  make  the 
proper  checkage  to  cover  the  allotment,  the  Bureau  paid  the 
allowance,  holding  that  the  allotment  had  been  made  but 
had  not  been  collected  to  date.  It  will  be  noted  that  the  Act 
provided  that  an  allotment  must  be  made,  but  did  not  specify 
that  it  had  to  be  collected. 

Even  with  these  liberal  interpretations  of  the  law,  it  was 
not  always  possible  to  make  an  award  to  all  deserving  wives 
and  neglected  children.  This  was  due  to  the  fact  that  the 
Bureau  was  unable  to  locate  many  of  these  negligent  men 
until  after  they  had  been  discharged  from  the  service.  The 
Bureau  was  not  entirely  to  blame,  since  it  did  not  receive 
prompt  aid  from  the  military  and  naval  authorities.  Fur- 
thermore, Congress  should  have  made  some  provision  for 
such  contingencies. 

Once  an  allotment  was  made  there  were  few  contingencies 
that  would  serve  as  a  cause  for  terminating  it.  Those  few 
were :  desertion,  court-martial,  and  imprisonment  with  a  dis- 
honorable discharge.  Whenever  the  Bureau  received  an 
official  notice  that  an  enlisted  man  in  the  army  had  deserted 
it  was  compelled  to  suspend  further  payments  to  his  depend- 
ents. Such  a  suspension  was  effective  as  of  the  day  before 
the  date  of  his  desertion.  The  same  policy  was  followed  in 
the  case  of  a  sailor  reported  as  a  deserter.  Whenever  such 
a  sailor  was  arrested  and  brought  under  naval  control,  he 
was  required  to  execute  a  new  allotment  application.  This 
allotment  was  effective  from  the  day  he  was  brought  under 
naval  control.  If  a  soldier  was  sentenced  by  a  court-martial 
to  imprisonment  and  given  a  dishonorable  discharge,  his  al- 

16 


lotment  and  the  Government  allowance  were  discontinued. 
On  the  other  hand,  if  a  soldier  was  sentenced  to  a  period  of 
confinement,  but  was  not  ordered  to  be  discharged  from  the 
service,  neither  his  allotment  nor  the  allowance  were  with- 
held from  his  relatives.  When  a  sailor  who  had  been  sen- 
tenced to  a  period  of  imprisonment  by  a  General  Court- 
Martial,  was  dishonorably  discharged  from  the  service  upon 
the  expiration  of  his  sentence,  his  allotment  and  allowance 
remained  in  force  during  the  period  of  his  imprisonment  or 
until  the  end  of  his  enlistment  period,  whichever  was  the 
earlier  date. 

From  the  foregoing  it  is  evident  that  the  framers  of  the 
Soldiers  and  Sailors  Insurance  Act  intended  to  grant  Gov- 
ernment allowances  to  the  immediate  family  dependents  of 
all  married  men  who  might  enter  the  military  or  naval  serv- 
ice of  the  nation.  As  before  stated,  the  Act  required  every 
married  man  in  the  service  to  make  an  allotment.  However, 
an  exemption  from  such  an  allotment  could  be  secured,  since 
the  Act  provided  that,  "Upon  the  enlisted  man's  application 
or  otherwise  for  good  cause  shown,  exemption  from  the  al- 
lotment may  be  granted  upon  such  conditions  as  may  be 
prescribed  by  regulations."  The  regulations  adopted  were 
very  stringent  and  required  that  an  enlisted  man  furnish 
most  convincing  proof  supported  by  the  affidavits  of  two  dis- 
interested persons  before  an  exemption  would  be  granted. 
The  Bureau  gave  an  accused  wife  every  opportunity  to  over- 
throw the  evidence  submitted  by  her  husband.  Only  when 
the  wife  was  unable  to  properly  deny  the  accusations  of  her 
husband  was  an  exemption  granted,  and  then  only  if  she 
had  seriously  violated  her  marital  vows. 

Because  of  the  delicate  character  of  most  of  these  cases, 
which  were  called  exemption  cases,  the  specific  regulations 
governing  their  disposition  has  been  held  confidential.  The 
general  theory,  that  every  man  should  support  the  woman 
he  has  taken  for  his  wife,  unless  she  has  proven  unfaithful, 
was  the  basis  of  the  regulations  governing  the  adjusting  of 
exemption  cases.  The  claims  for  exemption  were  numerous, 
and  we  find  that  the  Exemption  Section  of  the  Bureau  of 
War  Risk  Insurance  developed  into  a  Court  of  Domestic  Re- 
lations wherein  the  family  dissensions  of  thousands  of  our 
soldiers,  sailors,  and  marines  were  settled.  Since  the  Act 
aimed  to  provide  for  dependents,  the  benefit  of  doubt  in  all 
cases  was  given  to  the  wife,  and  she  was  considered  inno- 
cent until  her  husband  could  prove  absolutely  that  she  was 
guilty. 

In  addition  to  the  provision  for  compulsory  allotments, 
the  Act  provided  that  any  enlisted  man  could  make  a  volun- 
tary allotment  to  a  certain  relative.  If  such  relatives  were 

17 


, 


dependent  upon  the  enlisted  man,  within  the  meaning  of  the 
Act,  the  Government  was  willing  to  grant  them  an  allowance. 
The  Government  desired  to  aid  the  dependents  of  every  man 
called  into  the  service.  However,  such  persons  must  have 
been  in  the  so-called  "permitted  class,"  which  included  a 
mother  or  father,  a  mother-in-law  or  father-in-law,  a  sister 
or  brother,  a  grandchild  or  an  additional  parent. 

The  making  of  an  allotment  to  such  a  relative  was  purely 
a  voluntary  matter  to  be  decided  by  the  enlisted  man  himself. 
The  Government  compelled  a  man  to  support,  or  at  least 
contribute  to  the  support  of  his  wife  or  child,  but  it  did  not 
force  him  to  contribute  to  the  support  of  his  parents.  How- 
ever, if  a  man  did  make  a  voluntary  allotment  to  his  parents 
and  if  this  allotment  did  not  equal  his  former  contribution 
towards  their  support,  the  Government  granted  them  an 
allowance. 

The  scale  of  allowances  for  such  dependents  was  as  fol- 
lows: For  one  parent,  $10.00  a  month;  for  two  parents, 
$20.00;  for  a  grandchild,  brother,  sister  or  additional  parent, 
$5.00  a  month.  The  total  of  the  allowance  paid  to  any  one 
soldier's  dependents  could  not  exceed  the  sum  of  $50.00  a 
month. 

Before  proceeding  with  our  explanation  of  this  second 
plan  for  the  financial  relief  of  our  soldiers,  sailors,  and 
marines,  it  appears  necessary  to  quote  the  specific  conditions 
contained  in  the  Act,  which  had  to  be  fulfilled  before  an  al- 
lowance was  payable.  Section  206,  Paragraph  1,  states,  "that 
family  allowances  to  members  of  class  B,  shall  be  paid  only 
if  and  while  the  members  are  dependent  in  whole  or  in  part 
on  the  enlisted  man,  and  then  only  if  and  while  the  enlisted 
man  makes  a  monthly  allotment  of  his  pay  to  such  mem- 
bers." Section  206,  Paragraph  (a)  reads,  "If  an  enlisted 
man  is  not  making  a  compulsory  allotment  for  Class  A  the 
additional  allotment  required  as  a  condition  to  the  family 
allowances  shall  be  $5.00."  In  taking  up  this  particular 
feature  of  the  Act,  we  should  quote  Section  207,  Paragraph 
(b)  which  reads,  "the  total  monthly  allowance  to  bene- 
ficiaries of  Class  B  added  to  the  enlisted  man's  monthly 
allotment  to  them,  shall  not  exceed  the  sum  habitually  con- 
tributed by  him  to  their  support  monthly  during  the  period 
of  dependency,  but  not  exceeding  one  year  immediately  pre- 
ceding his  enlistment  or  the  enactment  of  this  amendatory 
Act." 

It  would  appear  that  the  Act  was  clear  and  specific  in  its 
designation  of  the  persons  entitled  to  Class  B  allowances 
and  of  the  conditions  governing  the  payment  of  them.  It  is 
hard  to  realize  that  it  was  so  generally  misunderstood.  How- 
ever, experience  proved  that  this  section  of  the  Act  was 

18 


generally  misinterpreted  or  grossly  ignored  by  commanding 
officers  and  enlisted  men  and  rarely  understood  by  parents 
and  other  dependents.  The  writer  considers  that  it  is  neces- 
sary to  give  a  more  detailed  explanation  of  the  conditions 
that  governed  the  paying  of  Class  B  allowances.  Briefly, 
these  conditions  were: 

1.  The  enlisted  man  had  to  make  an  allotment  in  favor 
of  his  dependents. 

2.  The  customary  contribution  of  the  enlisted  man  for  the 
support  of  his  dependents  must  have  been  a  sum  greater 
than  his  allotment. 

3.  The  allottee  must  have  been  dependent  upon  the  en- 
listed man.    All  three  of  these  conditions  had  to  be  fulfilled 
before  a  relative  in  the  permitted  class  was  rightfully  entitled 
to  an  allowance  from  the  Government. 

As  stated  above,  a  Class  B  allotment  was  a  voluntary 
one.  It  was  a  privilege  granted  to  all  enlisted  men,  but  it 
became  a  compulsory  matter  if  a  man  desired  the  Govern- 
ment to  aid  his  parents.  The  Government  was  willing  to 
aid  deserving  cases  providing  the  enlisted  man  in  each  case 
realized  his  responsibility  towards  his  parents.  It  aimed  to 
treat  all  men  in  the  service  in  an  impartial  manner  and, 
therefore,  required  an  unmarried  man  to  make  an  allotment 
of  $15.00  a  month  to  his  dependents  before  it  would  grant 
them  an  allowance.  In  the  case  of  a  married  man  having 
Class  B  dependents,  the  law  required  such  men  to  make  an 
allotment  of  $5.00  a  month  in  addition  to  their  compulsory 
allotment  of  $15.00. 

The  following  detailed  explanation  of  the  second  plan  of 
financial  relief  afforded  by  the  Soldiers  and  Sailors  Insur- 
ance Act  may  appear  superfluous,  but  one  familiar  with  the 
difficulties  encountered  by  the  officials  of  the  Bureau  of  War 
Risk  Insurance  in  the  administration  of  this  provision  of  the 
Act,  will  appreciate  the  necessity  of  it.  For  instance,  in  the 
early  days  of  the  war,  complaints  were  received  from  parents 
demanding  that  they  be  granted  the  customary  Class  B  al- 
lowances. Because  other  parents  in  their  community  were 
receiving  Government  allowances  they  considered  that  they 
were  entitled  to  the  same.  Usually  the  investigation  of  such 
a  case  disclosed  the  fact  that  no  allotment  had  been  made 
by  their  soldier  son  and,  therefore,  they  were  not  entitled 
to  an  allowance.  It  is  true  that  many  of  these  cases  were 
deserving  of  aid,  but  none  could  be  given  until  the  negligent 
son  had  complied  with  the  first  requirement  of  the  Act. 

The  second  condition,  the  soldier's  habitual  contribution, 
created  one  of  the  most  difficult  problems  that  the  Bureau 
had  to  handle.  Habitual  contribution  was  defined  as  mean- 
ing that  assistance  which  had  been  rendered  by  the  enlisted 

19 


man  previous  to  his  enlistment  for  the  support  of  his  de- 
clared dependents.  This  assistance  may  have  been  in  the 
form  of  money  or  personal  services.  But  the  value  of  either 
must  have  been  greater  than  his  allotment  before  any  con- 
sideration was  given  to  his  request  for  a  Class  B  allowance. 
When  the  habitual  contribution  of  a  man  who  had  lived  at 
home  included  payment  for  board  a  maximum  deduction  of 
$10.00  a  month  was  made  for  the  cost  of  food,  but  if  such  a 
deduction  would  deprive  a  dependent  of  an  allowance,  none 
was  made.  Monthly  contributions  towards  the  payment  of 
an  indebtedness  on  a  home  occupied  by  an  allottee  was  con- 
sidered a  contribution  because  of  dependency,  on  the  theory 
that  such  payments  were  identical  with  rent.  It  is  evident 
that  the  Bureau  was  liberal  in  estimating  the  value  of  a 
man's  contribution  to  his  dependents.  The  officials  gave  a 
broad  interpretation  to  this  phase  of  the  law  in  order  that  no 
deserving  parent  might  be  deprived  of  his  or  her  usual 
assistance. 

A  few  examples  will  do  much  to  clarify  this  particular 
clause  in  the  Act.  Let  us  take  the  case  of  a  man  who  had 
been  accustomed  to  contributing  $15.00  a  month  towards 
the  support  of  his  mother.  Just  previous  to  going  to  camp 
this  man  was  married.  What  obligations  did  he  have  to 
fulfill  in  order  to  secure  a  Government  allowance  for  his 
mother?  We  know  that  he  was  compelled  to  make  a  com- 
pulsory allotment  of  $15.00  a  month  to  his  wife.  In  order  to 
secure  an  allowance  for  his  mother  he  was  further  required 
to  make  a  voluntary  allotment  of  $5.00  a  month  to  her. 
Was  his  mother  entitled  to  an  allowance?  She  was,  provid- 
ing she  was  dependent  upon  him,  since  his  allotment  was 
only  $5.00  while  his  customary  contribution  to  her  had  been 
$15.00  a  month.  The  son  had  complied  with  the  law.  The 
mother  was  dependent.  Therefore,  the  Government  paid 
her  an  allowance  of  $10.00  a  month. 

On  the  other  hand,  take  the  case  of  a  boy  who  had  been 
contributing  $12.00  a  month  towards  the  support  of  his 
mother.  After  enlisting  this  young  man  wished  to  continue 
to  aid  his  mother.  He  made  an  allotment  of  $15.00  a  month 
to  her.  Being  a  dependent  parent,  was  she  entitled  to  an 
allowance?  No,  because  the  Act  stipulated  that  no  allow- 
ance was  payable  unless  the  habitual  contribution  exceeded 
the  allotment.  As  the  son  admitted  on  his  application  that 
his  customary  contribution  had  been  only  $12.00  a  month 
the  Bureau  could  not  pay  the  mother  an  allowance.  This 
mother  had  not  been  deprived  of  her  usual  support.  There- 
fore, the  Government  felt  under  no  obligation  to  aid  her. 

Many  parents,  not  properly  understanding  the  limitation 
which  this  habitual  contribution  condition  placed  on  the 

20 


amount  of  an  allowance  claimed  that  they  were  not  receiv- 
ing the  full  benefits  provided  by  the  Act.  The  following  is  a 
typical  case.  A  young  man,  on  entering  the  service,  declared 
that  he  had  a  dependent  father  and  mother  at  home.  He  was 
allowed  to  execute  an  allotment  and  allowance  application. 
On  his  application  he  declared  that  his  usual  contribution 
towards  the  support  of  his  parents  had  been  $25.00  a  month. 
Would  his  parents  receive  an  allowance  of  $10.00  apiece? 
No,  because  the  sum  of  the  allotment  and  the  allowances 
would  equal  $35.00  a  month.  The  total  would  be  greater 
than  the  son's  former  contribution,  therefore,  they  would 
only  receive  an  allowance  of  $5.00  apiece.  In  the  same 
community  the  parents  of  another  soldier  were  receiving  the 
full  allowances.  The  parents  of  the  first  boy  considered  that 
they  had  the  same  right  to  the  full  allowances  as  the  parents 
of  the  second.  However,  an  examination  of  the  facts  in  the 
second  case  showed  that  the  son  had  always  contributed 
$35.00  a  month  towards  the  support  of  his  parents.  They 
were,  therefore,  entitled  to  the  full  allowances. 

Condition  of  dependency  was  the  third  point  that  had  to 
be  taken  into  consideration  in  determining  whether  or  not 
a  person  was  entitled  to  a  Class  B  allowance.  A  soldier  may 
have  made  an  allotment  to  his  mother  and  his  allotment 
may  have  been  less  than  the  sum  of  his  habitual  contribu- 
tion, but  an  allowance  could  not  be  granted  unless  the 
mother  was  dependent  within  the  meaning  of  the  Act.  The 
Secretary  of  the  Treasury  defined  dependency  thus:  "A  per- 
son is  dependent  in  whole  or  in  part  upon  another,  when  he 
is  compelled  to  rely,  and  the  relations  between  the  parties 
are  such  that  he  has  a  right  to  rely,  in  whole  or  in  part,  on 
the  other  for  his  support." 

A  strict  and  technical  application  of  the  above  regulation 
was  not  enforced  when  its  enforcement  would  work  an  in- 
justice or  an  unwarranted  hardship  on  the  claimant.  The 
evidence  must  be  conclusive  and  prove  that  the  allottee  was 
not  dependent  in  whole  or  in  part  upon  the  enlisted  man 
before  an  allowance  was  withheld.  In  considering  such 
claims  for  allowances,  it  was  generally  presumed  that  de- 
pendency did  not  exist  if  the  allottee  had  an  individual  in- 
come exceeding  $50.00  a  month.  Even  with  such  an  income, 
an  allowance  was  granted,  if  the  evidence  submitted  proved 
that  this  sum  was  not  sufficient  to  meet  the  reasonable  and 
necessary  expenses  of  the  claimant.  For  instance,  a  father 
might  have  an  income  of  $50.00  a  month,  but  be  in  such 
physical  condition  as  to  be  in  constant  need  of  the  services 
of  a  physician.  Such  a  man  would  be  granted  an  allowance 
if  his  son  had  been  supporting  him  before  his  enlistment  and 
made  an  allotment  in  his  favor  after  entering  the  service. 

21 


It  is  evident  that  a  general  rule  could  not  be  laid  down 
and  applied  in  all  cases.  The  Bureau  gave  careful  consid- 
eration to  each  individual  case.  It  ascertained  the  income 
of  the  allottee,  the  pay  and  income  of  all  members  of  a 
claimant's  family  who  were  under  legal  age,  and  of  all 
persons  responsible  for  his  care  and  support.  The  Bureau 
never  denied  a  claim  for  an  allowance  whenever  a  doubt 
existed.  The  claimant  was  always  given  the  benefit  of  the 
doubt.  This  liberal  policy  probably  did  much  to  produce 
the  following  situation. 

During  the  first  months  that  the  Act  was  in  effect,  every 
opportunity  was  given  to  the  men  in  the  service  to  secure  an 
allowance  for  their  dependents.  The  formal  application  pro- 
vided was  simple  and  the  conditions  governing  the  granting 
of  allowances  were  stated  briefly,  in  order  that  the  average 
person  might  understand  them.  These  application  blanks 
called  for  such  ordinary  information  as  the  name,  relation- 
ship and  address  of  the  allottee,  the  amount  of  the  habitual 
contribution  of  the  allottor,  and  whether  an  allowance  was 
desired,  providing  the  allottee  was  dependent.  Upon  the  re- 
ceipt of  these  applications  at  the  Bureau,  awards  were  made 
to  the  designated  persons.  No  investigation  was  made  to 
determine  whether  or  not  the  facts  set  forth  in  the  applica- 
tions were  correct.  This  policy  was  followed  for  some  time 
by  the  Bureau,  as  it  presumed  that  the  men  had  been 
properly  instructed  in  the  law  by  their  officers. 

In  June,  1918,  a  general  investigation  of  Class  B  claims 
for  allowances  was  instituted.  A  questionnaire  was  mailed 
to  each  claimant,  requesting  answers  to  the  following  ques- 
tions: What  relationship  existed  between  the  allottee  and 
the  enlisted  man?  What  had  been  the  habitual  contribution 
of  the  enlisted  man  towards  the  support  of  the  allottee? 
What  portion  of  this  contribution  was  considered  as  pay- 
ment for  board  and  lodging  and  what  as  individual  support? 
What  was  the  monthly  or  annual  income  to  all  members  of 
the  allottee's  family  under  legal  age  who  were  domiciled 
with  him?  What  was  the  value  of  all  real  and  personal 
property  owned  by  the  allottee?  Last,  did  the  allottee  con- 
sider himself  or  herself  dependent  upon  the  enlisted  man 
and  entitled  to  a  Government  allowance? 

A  comparison  of  the  information  contained  in  one  hun- 
dred of  these  questionnaires  with  the  applications  filed  by 
the  enlisted  men  disclose  the  following  facts :  The  statements 
of  the  allottee  and  the  allottor,  as  to  the  habitual  contribu- 
tion of  enlisted  men,  differed  in  ninety  cases.  In  eighty- 
seven  cases,  the  enlisted  man  declared  that  his  customary 
contribution  was  larger  than  the  sum  admitted  by  the  re- 
cipient. In  three  cases  the  allottee  declared  that  he  received 

22 


a  larger  contribution  than  the  contributor  himself  admitted. 
In  ten  cases,  the  statements  of  both  parties  coincided.  The 
thousands  of  mail  investigations  conducted  revealed  prac- 
tically the  same  conditions  of  affairs  as  disclosed  in  the 
above  one  hundred  cases. 

The  Bureau,  therefore,  decided  to  send  out  field  investi- 
gators in  order  to  secure  more  reliable  information,  as  it 
was  apparent  that  the  law  was  being  violated.  The  officials 
wished  to  ascertain  the  true  facts  in  every  case  before  taking 
final  action  in  any  individual  case.  The  result  of  these  field 
investigations  invariably  confirmed  the  suspicion  that  thou- 
sands were  receiving  Government  allowances  to  which  they 
were  not  entitled.  However,  the  evidence  secured  generally 
showed  that  these  persons  were  innocent  of  any  intention 
to  violate  the  law.  They  had  accepted  the  Government's 
money  each  month  as  a  sort  of  compensation  for  the  de- 
privation they  suffered  by  the  enlistment  of  their  sons  or 
brothers. 

As  the  law  then  existed,  these  people  were  guilty  of  re- 
ceiving money  from  the  Government  to  which  they  had  no 
legal  title.  Since  the  Bureau  of  War  Risk  Insurance  was 
charged  with  the  duty  of  administering  the  law,  it  was  com- 
pelled to  notify  such  persons  that  they  would  have  to  return 
all  money  that  they  had  received  from  the  Government  in 
the  form  of  allowances.  In  a  short  time,  it  became  evident 
that  the  enforcement  of  this  order  would  result  in  the  work- 
ing of  a  grave  hardship  upon  many  innocent  people,  that  it 
would  cause  many  a  widow,  who  had  used  the  Government 
allowance  in  her  battle  against  the  increased  cost  of  living, 
to  go  out  to  work  in  her  old  age,  in  order  to  pay  the  Govern- 
ment, perhaps  compel  her  to  mortgage  her  home,  or  to  make 
some  equally  great  sacrifice. 

This  situation  was  only  relieved  by  the  enactment  of  an 
amendment  to  the  Act  of  October  6,  1917.  This  amendment 
absolved  the  Bureau  of  War  Risk  Insurance  from  the  dis- 
agreeable duty  of  collecting  these  allowances.  The  amend- 
ment providing  for  such  leniency  reads,  "That  whenever 
the  commissioner  shall  by  further  investigation  or  re-in- 
vestigation modify  the  existing  award,  no  reimbursement 
from  the  persons  receiving  an  allowance  shall  be  required 
for  allotments  and  allowances  already  paid." 

Immediately  after  the  passage  of  the  Act,  applications  for 
allowances  were  received  at  the  Bureau  at  the  rate  of  10,000 
a  day  from  December  1,  1917,  to  December  1,  1918.  On 
December  31st,  the  applications  received  numbered  273,013, 
and  the  awards  made  amounted  to  234,850.  One  month 
later,  the  number  of  applications  had  increased  to  411,418 
and  awards  of  allotments  and  allowances  had  been  made  in 

23 


402,458  cases.  By  April  30,  1918,  the  total  number  of  ap- 
plications increased  to  744,211  and  the  awards  granted  num- 
bered 748,000.  After  that  date,  the  number  of  awards  always 
exceeded  the  application  forms,  due  to  the  fact  that  many 
applications  called  for  more  than  one  award.  From  these 
figures,  it  is  apparent  that  whenever  the  application  blank 
was  properly  executed,  little  delay  ensued  and  awards  were 
practically  current  with  the  applications  received. 

The  magnitude  of  the  relief  rendered  by  the  Allotment 
and  Allowance  provision  of  the  Soldiers  and  Sailors  Insur- 
ance Act  may  be  feebly  realized  when  one  considers  that  the 
number  of  applications,  on  which  payments  were  made, 
numbered  2,079,690;  the  sum  paid  out  in  allotments  was 
$285,672,241.69;  and  the  allowances  granted  by  the  Govern- 
ment totalled  $261,911,234.00,  making  a  grand  total  of 
$547,583,476.19,  paid  out  in  allotments  and  allowances  up  to 
April  1,  1920. 

The  relief  rendered  was  world-wide,  as  the  Bureau  sent 
checks  to  dependents  in  practically  every  city,  town,  and 
crossroads  in  the  United  States,  and  in  the  following  foreign 
countries:  Argentine,  Assyria,  Australia,  Bahamas,  Barba- 
dos, British  Guiana,  British  Honduras,  British  West  Indies, 
Belgium,  Canada,  Columbia,  Cuba,  Chile,  Denmark,  Domin- 
ican Republic,  Dutch  Guiana,  Dutch  West  Indies,  England, 
France,  French  Guiana,  Greece,  Guam,  Guatamala,  Haiti, 
Holland,  Honduras,  Italy,  Ireland,  Iceland,  Japan,  Mexico, 
Nicaragua,  Norway,  Peru,  Porta  Rico,  Portugal,  Newfound- 
land, New  Zealand,  Servia,  Spain,  Sweden,  Switzerland,  Scot- 
land, Salvador,  Uruguay,  Venezuela,  Wales,  West  Indies. 


21 


II 

COMPENSATION 

The  second  problem  confronting  the  authors  of  the  Sol- 
diers and  Sailors  Insurance  Act  was  how  to  provide  finan- 
cial assistance  for  the  dependents  of  all  men  who  might  be 
killed  in  battle,  how  to  make  reparation  to  those  men  who 
might  be  injured  in  the  service.  There  were  then  in  exist- 
ence and  in  operation  pension  laws  which  could  have  been 
enlarged  upon,  but  Congress  felt  that  a  more  modern  law 
similar  to  our  various  workmen's  compensation  acts,  was 
more  in  harmony  with  our  twentieth  century  ideals.  Those 
familiar  with  the  philosophy  underlying  workmen's  compen- 
sation know  that  it  is  based  on  the  theory  that  all  workmen 
sustaining  injuries  during  the  course  of  their  employment 
are  entitled  to  a  certain  percentage  of  their  wages  during 
the  period  of  incapacity.  This  payment  is  presumed  to  be 
a  compensation  for  the  economic  loss  sustained  by  reason  of 
injury.  The  same  policy  is  followed  in  caring  for  the  de- 
pendents of  any  man  who  is  killed  or  dies  from  injuries 
incurred  during  the  course  of  his  employment.  Therefore, 
a  compensation  provision  analagous  to  these  workmen's  com- 
pensation acts  was  incorporated  in  the  Soldiers'  and  Sailors' 
Insurance  Act.  It  is  analagous  in  this  respect,  that  the  pay- 
ments made  to  the  injured  man  or  to  the  dependents  of  one 
killed  in  the  service  are  determined  by  the  effect  that  like 
injuries  have  on  the  earning  capacities  of  men  engaged  in 
civilian  occupations. 

Statesmen  and  social  scientists  have  almost  uniformly 
agreed  that  this  policy  is  the  most  equitable  means  of  caring 
for  the  victims  of  modern  warfare.  It  provides  benefits  for 
the  man  himself  and  for  those  dependent  upon  him.  Such 
provision  was  necessary  after  the  passage  of  the  Selective 
Service  Act,  since  its  operation  often  resulted  in  the  drafting 
of  the  breadwinner  of  a  family,  and  thereby  resulted  in  the 
conscription  of  the  entire  family.  It  is  evident  that  when 
such  a  man  was  discharged  from  the  service,  after  having 
sustained  injuries,  that  he  and  his  family  were  in  need  of 
financial  assistance.  It  is  but  just  that  the  nation  provide 
for  such  men  and  for  the  dependents  of  those  who  gave  their 
lives  in  the  defense  of  national  ideals.  The  nation  benefited 
by  the  services  and  sacrifices  of  such  men  as  an  employer 

25 


benefits  by  the  services  of  his  employees.  Since  an  employer 
of  an  injured  workman  is  compelled  to  indemnify  his  em- 
ployee, likewise  the  United  States  Government  should  indem- 
nify those  who  served  it  at  the  risk  of  their  lives. 

The  need  of  a  change  from  the  old  pension  system  was 
patent,  and  when  Congress  was  convinced  of  the  benefits 
of  modern  compensation  legislation,  Article  III  was  embodied 
in  the  Soldiers  and  Sailors  Insurance  Act.  This  Article 
provided  that  compensation  be  paid  for  the  death  or  injury 
of  or  for  disease  contracted  in  line  of  duty  by  an  officer  or 
enlisted  man  or  by  any  member  of  the  Army  or  Navy  Nurse 
Corps  (female)  when  employed  in  the  active  service  of  the 
War  Department  or  Navy  Department.  However,  no  com- 
pensation was  provided  for  any  injury  or  disease  caused  by 
the  claimant's  own  wilful  misconduct.  The  benefits  pro- 
vided by  this  Article  of  the  Act  were  divided  into  two 
classes:  compensation  to  the  dependents  of  any  man  who 
died  or  was  killed  in  the  service,  and  compensation  to  the 
soldier  himself  for  injury  or  disease  incurred  or  contracted 
in  or  due  to  his  service. 

The  conditions  which  have  to  be  satisfied  in  order  to  secure 
compensation  for  the  death  of  any  member  of  the  Army, 
Navy  or  Marine  Corps  are:  First,  the  deceased  must  have 
been  a  member  of  such  an  organization  and  have  been  in 
the  active  service;  second,  his  death  must  have  resulted  from 
injuries  incurred,  or  from  disease  contracted  in  line  of  duty; 
third,  such  injury  or  disease  must  not  have  resulted  from 
his  own  wilful  misconduct.  These  requirements  having 
been  satisfied,  compensation  is  payable  to  certain  dependents 
in  specific  amounts  as  designated  in  Section  301,  Article  III. 

SCHEDULE  OF  COMPENSATION  DEATH  BENEFITS 

If  there  is  a  widow  but  no   children $25.00  a  month 

If  there  is  a  widow  and  one  child 35.00 

If  there  is  a  widow  and  two  children 42.50 

If  there  is  a  widow  and   three   children 47.50 

If  there  is  a  widow  and  four   children 52.50 

If  there  is  no  widow  but  one  child 20.00 

If  there  is  no  widow  but  two  children 30.00 

If  there  is  no  widow  but  three  children 40.00 

If  there  is  no  widow  but  four  children 45.00 

If  there  is  no  widow  but  five  children 50.00 

If  there  is  one  dependent  parent 20.00 

If  there  are  two  dependent  parents 30.00 

The  "active  service"  limitation  found  in  the  compensation 
section  of  the  Act  worked  a  grave  injustice  on  many  of  the 
dependents  of  those  men  who  died  before  their  induction 
into  the  service  had  been  completed,  but  which  occurred 

26 


after  they  had  been  ordered  to  camp  by  their  respective  draft 
boards.  As  the  Act  originally  read,  this  "active  service" 
status  limited  the  benefits  of  compensation  to  the  dependents 
of  deceased  men,  provided  such  men  had  been  medically 
examined  and  enrolled  by  the  military  authorities.  Accord- 
ingly, it  barred  the  dependents  of  any  man  who  died  or  was 
killed  after  his  induction  by  his  local  draft  board,  but  before 
he  had  been  enrolled  in  the  active  service  of  the  United  States 
Army.  This  limitation  was  effective  in  spite  of  the  fact  that 
any  man  refusing  to  comply  with  the  orders  of  his  draft 
board  would  have  been  tried  before  a  military  court. 

The  following  case  will  serve  to  show  the  injustice  of  this 
limitation:  A  man  having  a  wife  and  child  was  ordered  by 
his  draft  board  to  report  for  medical  examination.  After  his 
examination  he  was  accepted  for  military  service  and  ordered 
to  report  to  a  designated  cantonment.  On  arriving  at  the 
camp  he  was  placed  in  a  barracks  pending  his  physical  exam- 
ination by  an  army  physician.  Influenza  being  prevalent  in 
the  camp,  all  the  medical  officers  were  busy  caring  for  the 
victims  of  the  epidemic.  Although  this  conscript  was  in 
perfect  health  when  leaving  his  home,  he  contracted  the  In- 
fluenza and  died.  As  he  had  not  been  examined  by  an  Army 
physician,  according  to  Army  Regulations,  he  could  not  be 
enrolled  in  the  Army  for  "active  service."  Under  the  exist- 
ing law,  the  Bureau  of  War  Risk  Insurance  was  unable  to 
grant  compensation  to  the  widow  and  child,  although  the 
cause  of  the  draftee's  death  was  the  influenza  which  he  had 
contracted  after  he  had  been  ordered  to  camp  by  his  draft 
board. 

The  prevalence  of  such  cases  compelled  Congress  to 
amend  the  Act  of  December  24,  1919.  The  scope  and  mean- 
ing of  the  term  "active  service"  was  enlarged  to  read  as 
follows:  "If,  after  induction  by  a  local  draft  board,  but  be- 
fore being  accepted  and  enrolled  for  active  service,  the  per- 
son died  or  became  disabled  as  a  result  of  disease  contracted 
or  injury  suffered  in  the  line  of  duty  and  not  due  to  his 
own  wilful  misconduct  involving  moral  turpitude  or  as  a 
result  of  the  aggravation  in  the  line  of  duty  and  not  because 
of  his  own  wilful  misconduct  involving  moral  turpitude,  of 
an  existing  injury  or  disease;  he  or  those  entitled  thereto 
shall  receive  the  benefits  of  compensation  payable  under 
Article  III." 

Since  the  enactment  of  this  amendment,  a  broad  interpre- 
tation has  been  given  to  the  term  "active  service."  It  is 
now  presumed  that  a  man  was  in  "active  service"  from  the 
date  of  his  induction  by  his  local  draft  board  until  the  date 
of  his  discharge  or  indefinite  furlough. 

The  "line  of  duty"  status  has  also  given  some  trouble  and 

27 


has  caused  some  difficulties  in  the  administration  of  the 
Act.  However,  for  the  purposes  of  the  Act  the  Bureau  of 
War  Risk  Insurance  interprets  "line  of  duty"  to  mean  any 
act  which  a  soldier,  sailor,  or  marine  may  perform  that 
is  not  prohibited  by  a  special  order  of  a  military  or  naval 
authority.  In  other  words  an  enlisted  man  is  presumed  to 
be  acting  within  the  scope  of  his  "line  of  duty"  while  he  is 
in  the  active  service.  An  illustration  of  this  broad  inter- 
pretation is  shown  in  the  following  instance:  An  officer 
was  injured  by  a  street  car,  while  he  was  returning  to  quar- 
ters from  a  public  assembly.  He  was  the  victim  of  an  ac- 
cident which  happened  when  he  was  not  acting  contrary 
to  military  orders.  His  family,  therefore,  is  entitled  to 
compensation  if  he  should  die  from  his  injuries. 

The  general  policy  of  the  Bureau  has  been  to  grant  com- 
sation  to  the  wives  and  children  of  practically  all  men  killed 
in  the  service.  Of  course,  wilful  misconduct  is  still  an  ef- 
fective bar  to  all  compensation  benefits,  but  it  is  almost  im- 
possible to  prove  that  a  man  met  his  death  in  the  military 
service  through  his  own  wilful  misconduct.  In  order  to 
arrive  at  such  a  conclusion,  the  Bureau  must  be  in  posses- 
sion of  evidence  that  will  conclusively  prove  the  deceased 
had  acted  in  wanton  disregard  of  military  or  public 
authority. 

Before  compensation  can  be  paid  on  a  death  claim  cer- 
tain evidence  must  be  furnished  by  the  claimant.  In  addi- 
tion, other  evidence  must  be  secured  from  the  War  or  Navy 
Department  by  the  officials  of  the  Bureau  of  War  Risk 
Insurance.  The  claimant  is  requested  to  furnish  the  fol- 
lowing information:  First,  the  full  name  of  the  deceased; 
second,  the  date  of  his  enlistment;  third,  his  rank  and  the 
organization  to  which  he  was  attached;  fourth,  the  relation- 
ship of  the  claimant  to  the  deceased;  and  fifth,  affidavits 
supporting  the  claim  of  relationship  and  dependency. 

The  Bureau  must  secure  certain  additional  information. 
It  must  ascertain  whether  or  not  the  deceased  was  in  the 
service  and  whether  or  not  the  injury  or  disease,  which 
caused  his  death,  was  incurred  or  contracted  while  he  was 
in  the  actual  performance  of  his  duty  and  that  it  did  not 
result  from  his  own  wilful  misconduct.  If  the  evidence  is 
complete  and  proves  the  validity  of  the  claim,  then  com- 
pensation is  paid  from  the  date  after  the  day  of  the  death 
of  the  Soldier,  Sailor,  or  Marine. 

A  further  examination  of  the  rules  and  regulations  in 
force  will  show  more  clearly  the  manner  in  which  the  law 
operates.  Should  the  claimant  be  a  widow,  she  is  required  to 
furnish  a  copy  of  her  marriage  certificate  or  church  record 
of  her  marriage  or  secure  the  affidavits  of  two  eyewitnesses 

28 


of  the  ceremony.  In  lieu  of  such  proof  she  must  secure  affi- 
davits from  two  persons  who  knew  the  deceased  and  the 
claimant,  and  who  can  affirm  that  this  widow  and  the  de- 
ceased lived  together  as  man  and  wife. 

If  the  widow  is  a  minor  and  the  laws  of  the  state  of  her 
residence  require  that  she  must  have  a  legal  guardian  to 
receive  her  money,  then  such  a  guardian  must  be  appointed 
before  the  Bureau  can  pay  her  compensation  for  the  death 
of  her  husband.  It  is  necessary  that  the  papers  of  guardian- 
ship specifically  provide  that  the  appointed  person  be  em- 
powered to  receive  such  compensation  payments.  Should 
the  laws  of  the  state  require  that  the  guardian  furnish 
bonds,  he  must  do  so  before  the  widow's  money  will  be 
entrusted  to  him. 

It  might  be  well  to  explain  the  meaning  of  the  term 
widow,  as  used  in  the  Act.  A  widow  is  a  woman  who  was 
married  to  the  deceased  before  his  enlistment  or  at  least 
within  ten  years  after  he  sustained  his  injury.  The  widow 
of  a  common  law  husband  is  entitled  to  the  same  consider- 
ation as  one  married  by  a  clergyman  or  public  official.  How- 
ever, common  law  marriages  must  have  been  consummated 
and  have  taken  place  in  states  wherein  they  are  recognized. 

The  child  of  a  deceased  officer  or  enlisted  man  is  entitled 
to  compensation  as  provided  in  the  schedule  given  on  the 
preceding  page.  Such  payments  terminate  on  the  child's 
eighteenth  birthday.  However,  if  a  child  is  declared  to 
be  incapable  because  of  insanity,  idiocy,  or  some  other  per- 
manent disability,  compensation  is  continued  as  long  as  the 
disability  exists. 

A  child  claiming  compensation  because  of  the  death  of 
its  father  is  required  to  furnish  a  copy  of  its  birth  certifi- 
cate. If  such  a  certificate  cannot  be  secured,  then  the  record 
of  its  baptism  may  be  accepted.  If  neither  of  these  records 
can  be  secured  affidavits  must  be  secured  from  two  persons 
setting  forth  the  relationship  that  existed  between  the  de- 
ceased and  the  claimant. 

Compensation  is  payable  to  a  step-child  provided  proof 
be  offered  showing  that  it  was  actually  a  member  of  the 
deceased  man's  household  and  dependent  upon  him  for  sup- 
port. The  claim  of  an  illegitimate  child  must  be  supported 
by  a  statement  previously  made  by  the  deceased  wherein 
he  acknowledged  such  child  as  his  own.  Whenever  it  is  pos- 
sible to  secure  the  record  of  a  court  of  competent  jurisdic- 
tion designating  the  dead  man  as  the  father  of  the  child, 
compensation  can  be  paid  immediately.  Any  evidence  sub- 
mitted by  a  claimant  must  be  properly  witnessed,  signed 
and  sworn  to  before  an  official  empowered  to  administer 
oaths. 

29 


To  a  single  dependent  parent,  the  sum  of  $20.00  a  month 
is  payable.  If  there  be  two  dependent  parents,  the  monthly 
compensation  is  $30.00.  However,  the  amount  payable  to 
a  father  or  a  mother  or  both  cannot  exceed  the  difference  be- 
tween the  total  compensation  payable  to  the  widow  and  her 
children  and  the  maximum  payment  of  $75.00  a  month.  For 
instance,  if  a  deceased  soldier  is  survived  by  a  widow  and 
four  children  and  also  a  dependent  father  and  mother,  the 
amount  payable  to  the  parents  will  be  $22.50  a  month  in- 
stead of  $30.00.  The  reason  for  this  is  that  the  widow 
and  her  children  have  a  prior  right  to  all  benefits  and  in 
most  states  inherit  the  husband's  and  father's  estate. 

The  Act  specifies  that  a  parent  can  only  receive  compen- 
sation for  the  loss  of  one  son.  A  mother  who  gave  three 
sons  to  her  country  does  not  receive  $60.00  a  month,  but 
$20.00.  A  woman  who  has  lost  both  her  husband  and  a 
son  can  only  receive  compensation  for  the  loss  of  her  hus- 
band. In  short,  a  woman  can  only  receive  compensation 
for  the  loss  of  one  member  of  her  family. 

Parents  are  required  to  furnish  proof  of  their  relation- 
ship and  dependency  upon  a  deceased  son.  Proof  of  re- 
lationship may  be  established  by  a  certified  copy  of  the 
birth  record  of  the  deceased,  the  church  record  of  his  bap- 
tism, or  a  copy  of  the  record  of  his  birth  contained  in  the 
family  bible.  It  is  also  necessary  that  affidavits  be  secured 
from  two  persons  certifying  the  relationship  of  the  claim- 
ant to  the  deceased. 

A  condition  of  dependency  must  be  shown  to  have  ex- 
isted. Such  dependency  may  have  been  complete  or  partial. 
The  statement  of  dependency  must  be  supported  by  the 
affidavits  of  two  disinterested  persons.  These  affidavits  must 
include  such  information  as  the  amount  of  the  total  annual 
income  of  the  claimant,  whether  or  not  this  includes  wages 
earned,  and  whether  or  not  the  claimant  is  capable  of  en- 
gaging in  a  gainful  occupation.  In  addition  these  state- 
ments must  show  the  average  monthly  contribution  of  the 
deceased  previous  to  his  enlistment,  the  location  and  value 
of  all  personal  and  real  property  owned  by  the  claimant, 
the  monthly  income  from  such  property,  and  finally  a  dec- 
laration by  the  witness  as  to  where  and  how  he  received 
such  information. 

It  is  not  necessary  that  dependency  be  shown  and  proven 
to  exist  previous  to  the  enlistment  of  the  deceased  in  order 
that  a  parent  may  receive  compensation.  But  if  such  de- 
pendency did  not  exist  previously,  it  must  have  arisen  within 
five  years  after  the  death  of  the  soldier  son. 

It  is  usually  a  simple  matter  to  determine  the  relationship 
of  a  claimant  to  the  deceased,  but  it  is  rather  difficult  at 

30 


times  to  determine  whether  or  not  a  parent  is  dependent. 
The  question  of  dependency  cannot  be  decided  on  general 
principles.  Each  individual  case  must  be  judged  on  its 
own  merits  from  the  evidence  submitted. 

If  the  evidence  in  a  case  shows  that  a  parent  is  in  re- 
ceipt of  an  income  sufficient  to  provide  for  his  reasonable 
support  and  maintenance,  including  clothing  and  necessary 
medical  treatment  for  himself  and  the  members  of  his  family 
under  legal  age,  dependency  is  not  presumed  to  exist  and 
no  compensation  is  paid. 

Awards  for  compensation  had  been  made  on  45,267  claims 
at  the  close  of  the  fiscal  year  of  June  30,  1920.  The  monthly 
payments  to  dependents  amounted  to  over  $1,000,000.00. 
Payments  on  death  claims  were  refused  in  80,480  cases  dur- 
ing the  period  ending  June  30,  1920.  Compensation  was 
disallowed  because  the  claimant  was  not  in  the  permitted 
class  of  beneficiaries,  or  because  death  occurred  not  in  line 
of  duty,  or  death  resulted  from  the  deceased's  own  wilful 
misconduct.  Claims  were  sometimes  disallowed  because  the 
claimant  failed  to  submit  sufficient  proof  to  support  his 
claim.  However,  any  disallowed  claim  may  be  reopened 
upon  the  submission  of  additional  proof  or  evidence. 

The  Act  further  provides  that  the  Government  will  pay 
upon  written  application  all  reasonable  funeral  expenses, 
including  the  expense  of  burial  and  transportation  home  of 
the  body  of  any  man  that  died  in  the  service,  but  this  amount 
cannot  exceed  the  sum  of  $100.00.  The  total  number  of 
these  burial  awards  up  to  June  30,  1920,  was  30,861  amount- 
ing to  $2,175,270.06. 

In  addition  to  the  benefits  granted  to  the  dependents  of 
those  men  killed  in  the  service,  compensation  benefits  were 
provided  for  disabled  veterans  and  their  families.  Indeed 
these  are  the  persons  most  interested  in  the  compensation 
provision  of  the  Soldiers  and  Sailors  Insurance  Act.  They 
and  their  families  are  dependent  upon  the  Government  for 
financial  support. 

Because  of  the  variations  in  the  injuries  sustained  by 
these  men,  the  awarding  of  compensation  to  them  has  been 
a  difficult  and  intricate  task. 

According  to  the  terms  of  the  Act  every  officer  and  en- 
listed man  who  sustained  an  injury  or  contracted  a  disease 
which  has  resulted  in  a  disability  is  entitled  to  certain  bene- 
fits. The  amount  of  the  benefit  payable  to  any  individual 
is  determined  by  the  extent  of  his  disability  but  in  no  case 
is  compensation  payable  unless  the  disability  has  caused 
at  least  a  ten  per  cent  reduction  in  the  earning  capacity  of 
the  claimant. 

Disabilities   are   classed   as   permanent   total,   permanent 

31 


partial,  temporary  total,  and  temporary  partial.  Originally 
the  same  benefit  was  provided  for  total  permanent  disability 
as  for  temporary  total.  However,  by  the  amendment  of 
December  24,  1919,  the  amount  payable  for  a  total  perma- 
nent disability  is  greater  than  that  provided  for  a  total  dis- 
ability which  is  only  temporary  in  its  duration.  The  bene- 
fits provided  for  under  the  original  Act  and  by  the  amend- 
ment are  given  below. 

COMPENSATION  BENEFITS  FOR  TOTAL  AND  PERMANENT 
DISABILITY 

Original  Act        Amendment 

For  general  total  permanent  disability $  30.00  $100.00 

For  the  loss  of  both  feet  or  both  hands  or 

both  eyes,  or  for  becoming  totally  blind 

or    becoming    helpless    and    permanently 

bedridden  from  causes  occurring  in  line 

of  duty  in  the  active  service  of  the  United 

States  100.00  100.00 

For  the  loss  of  one  foot  and  one  hand,  or 

one  foot  and  the  sight  of  one  eye,  or  one 

hand  and  the  sight  of  one  eye 30.00  100.00 

For  the  loss  of  both  eyes  and  both  feet,  or 

both  eyes  and  both  hands,  for  both  hands 

and  both  feet 100.00  200.00 

If  a  person  is  so  helpless  as  to  be  in  con- 
stant need  of  a  nurse  or  an  attendant, 

an  additional  sum  is  provided,  viz.: 20.00  20.00 

The  harmony  and  symmetry  of  the  compensation  scale  is 
marred  by  the  flat  rate  provided  for  all  permanently  totally 
disabled  claimants  irrespective  of  the  number  of  their  de- 
pendents. It  is  obvious  that  an  injured  man  who  has  a 
wife  and  child  dependent  upon  him  is  in  need  of  greater 
financial  assistance  than  an  injured  man  who  is  unmarried. 
This  is  the  only  place  in  the  entire  Act  where  the  family 
status  of  a  claimant  is  disregarded. 

All  claims  for  permanent  and  total  disability  must  be  sup- 
ported by  proper  evidence.  The  claimant  must  show  that 
he  has  been  discharged  from  the  service,  since  compensa- 
tion cannot  be  paid  while  a  man  is  in  receipt  of  his  regular 
service  pay.  The  Bureau  must  secure  a  history  of  his  serv- 
ice in  order  to  ascertain  just  when  and  where  his  disability 
arose  and  the  circumstances  surrounding  it.  The  opinion  of 
experts  must  be  obtained  and  must  show  that  the  claimant's 
physical  or  mental  condition  is  such  as  to  preclude  the  pos- 
sibility of  his  ever  being  able  to  engage  in  any  gainful  occu- 
pation. 

While  such  information  is  being  secured  it  has  been  the 
policy  of  the  Bureau  to  grant  the  claimant  compensation 

32 


for  a  temporary  total  disability.  Such  an  award  will  pro- 
vide a  disabled  man  with  sufficient  funds  to  secure  the  neces- 
sities of  life  while  he  is  awaiting  the  final  disposition  of 
his  case. 

The  combination  of  any  two  permanent  disabilities  which 
totally  incapacitates  a  man  is  considered  a  double  permanent 
total  disability,  as  for  instance,  the  loss  of  the  sight  of  both 
eyes  and  the  loss  of  both  feet.  The  monthly  payment  to  such 
a  sufferer  is  $200.  No  consideration  is  given  to  the  family 
status  of  the  disabled.  Prior  to  December  24,  1919,  the 
Bureau  was  authorized  to  make  an  award  of  only  $100.00 
in  such  cases. 

This  increase  of  $100.00  a  month  for  double-permanent- 
total  disability  was  due  to  the  fact  that  a  typical  case  was 
brought  before  the  attention  of  Congress.  The  case  in  ques- 
tion was  that  of  a  soldier  who  had  lost  both  hands  and  the 
sight  of  both  eyes.  H.  R.  Bill  6450  was  introduced  and 
passed  without  opposition  which  granted  this  unfortunate 
veteran  $200.00  for  the  rest  of  his  life.  This  bill  became  a 
law  when  signed  by  the  President  on  August  6,  1919. 

In  addition  to  the  payment  of  $100.00  a  month,  any  per- 
son suffering  a  permanent  and  total  disability  is  entitled 
to  $20.00  a  month  for  a  nurse  or  an  attendant.  The  pay- 
ment of  this  additional  sum  is  not  mandatory  but  is  left 
to  the  discretion  of  the  Director  of  the  Bureau  of  War  Risk 
Insurance.  However,  all  reasonable  claims  for  this  addi- 
tional allowance  are  granted  whenever  there  is  sufficient 
evidence  to  substantiate  them. 

All  permanent  partial  disabilities  are  provided  for  in  the 
Act  which  reads,  "If  and  while  the  disability  is  partial,  the 
monthly  compensation  shall  be  a  percentage  of  the  com- 
pensation that  would  be  payable  for  his  total  disability, 
equal  to  the  degree  of  the  reduction  in  earning  capacity  re- 
sulting from  the  disability,  but  no  compensation  shall  be 
payable  for  a  reduction  in  earning  capacity  rated  at  less 
than  ten  per  centum." 

Thus,  any  man  who  has  suffered  a  permanent  partial 
disability  which  is  rated  by  the  Bureau  as  greater  than  ten 
per  cent  is  entitled  to  a  percentage  of  $100.00,  the  amount 
payable  monthly  for  a  permanent  and  total  disability.  These 
permanent  partial  payments  are  determined  by  a  confiden- 
tial scale  of  ratings  known  only  to  the  officials  of  the  Bureau. 
The  most  that  can  be  said  is  that  each  case  is  decided  ac- 
cording to  the  extent  of  the  anatomical  disability  sustained 
by  the  claimant  and  by  the  effect  that  like  disabilities 
usually  have  on  the  earning  capacities  of  individuals  sus- 
taining similar  injuries  in  civilian  occupations.  It  is  evident 
therefore,  that  the  precise  reduction  in  an  individual's  earn- 

33 


ing  capacity  is  not  the  determinant  of  his  compensation  pay- 
ment. 

It  is  true  that  a  perfect  compensation  law  would  indem- 
nify a  man  for  the  exact  amount  of  his  loss.  Thus  a  violin- 
ist who  had  lost  a  finger  would  receive  a  larger  award  than 
a  clerk  or  student  suffering  a  similar  injury,  for  it  is  obvious 
that  the  loss  of  a  finger  would  result  in  a  more  serious  re- 
duction in  the  earning  capacity  of  the  former  than  the  latter. 
However,  we  must  not  jump  to  the  conclusion  that  the 
Government  is  treating  its  permanently  injured  soldiers  and 
sailors  unjustly.  The  Act  stipulates  that  no  reduction  shall 
be  made  in  the  amount  of  the  compensation  payable  to  any 
person  sustaining  a  permanent  disability,  even  though  such 
a  person  may  overcome  his  handicap.  Once  a  rating  is  made 
for  a  permanent  disability  it  remains.  For  instance,  if  a  sol- 
dier is  receiving  $30.00  a  month  for  the  loss  of  a  leg,  he  will 
always  receive  such  an  amount.  He  may  even  be  able  to 
earn  twice  as  much  in  a  new  occupation  as  in  his  old  one, 
but  his  compensation  will  be  $30.00  a  month  for  the  rest 
of  his  life. 

Such  a  man  may  take  up  a  course  of  training  under  the 
direction  of  the  Federal  Board  for  Vocational  Education. 
During  the  period  of  his  training  his  compensation  will  be 
discontinued  since  he  will  be  entitled  to  $80.00  a  month 
from  the  Federal  Board  while  he  is  under  its  direction. 
But  when  he  has  completed  his  course  he  will  again  be 
entitled  to  compensation  at  the  rate  of  $30.00  a  month. 

Though  the  Federal  Board  for  Vocational  Education  may 
have  been  open  to  criticism  in  the  past,  we  must  consider 
the  size  and  complexity  of  the  problem  that  confronted  it. 
Vocational  Education  in  the  United  States  was  in  its  in- 
fancy; experience,  facilities,  and  teachers  were  and  are  lack- 
ing in  this  country.  The  Federal  Board  has  made  every  ef- 
fort to  care  for  the  ever  growing  army  of  disabled  veterans 
of  the  Great  War. 

The  present  plan  adopted  by  the  Federal  Board  aims  to 
help  every  injured  veteran  to  resume  his  former  occupa- 
tion or  to  take  up  some  new  one.  Whether  a  man  is  able 
to  resume  his  old  occupation  or  not,  the  Board  is  willing 
to  aid  him  in  preparing  for  a  new  one.  Every  effort  is  being 
made  to  assist  such  men  in  taking  up  an  occupation  for 
which  they  are  best  fitted  and  in  which  they  are  interested. 
Such  men  are  given  the  widest  possible  choice  of  trades  and 
occupations.  This  choice  includes  commerce,  industry, 
transportation  and  even  the  professions.  The  length  of  the 
course  of  instruction  depends  upon  the  requirements  of 
the  vocation,  and  upon  the  interest  and  the  ability  of  the 
student. 

34 


While  in  training  the  student,  in  addition  to  his  tuition 
and  books  is  entitled  to  the  following  allowances: 

For  a  single  man _. -- $  80.00  a  month 

For  a  man  and  wife. __ - 115.00 

For  a  man,  wife  and  child - 125.00 

For  a  man,  wife  and  two  children 132.50 

For  a  man,  wife  and  three  children. 137.50 

For  a  man,  wife  and  four  children 142.50 

For  a  man,  wife  and  five  children 147.50 

For  a  man,  wife  and  six  or  more  children 150.00 

The  Darrow  Bill  provides  for  additional  allowances  up  to 
$20.00  a  month  for  single  men  training  in  localities  in  which 
the  cost  of  living  is  above  the  average,  or  comparatively 
high.  This  law  caused  Federal  Board  officers  to  make  a 
study  of  the  cost  of  living  in  the  communities  in  which  some 
1,600  institutions  and  4,000  factories  are  aiding  in  the  train- 
ing of  former  service  men. 

It  must  be  clear  to  all  that  the  Government  intends  to 
solve  the  problem  of  human  waste,  caused  by  the  war,  in 
the  most  scientific  and  economic  manner  possible.  It  does 
not  propose  to  make  pensioners  of  those  men  who  lost  a  limb 
in  the  defense  of  their  country;  nor  does  it  propose  to 
drive  them  into  homes  for  the  maimed;  its  aim  is  rather 
to  render  them  economically  independent. 

The  vast  majority  of  the  claims  for  compensation  being 
adjudicated  by  the  Bureau  at  the  present  time  are  for  tem- 
porary total  and  temporary  partial  disabilities.  Many  men 
have  sustained  injuries  which  have  totaljy  incapacitated 
them,  but  only  for  a  time,  while  others  are  suffering  from 
partial  disabilities  of  a  temporary  nature.  Under  the  orig- 
inal Act  the  payments  for  such  disabilities  were  inadequate, 
the  maximum  for  a  single  man  being  $30.00  a  month.  How- 
ever, the  amendment  of  December  24,  1919,  provided  more 
liberal  benefits. 

In  the  table  below  are  given  the  benefits  previously 
payable  for  temporary  total  disability  and  those  benefits 
now  being  paid. 

MONTHLY   COMPENSATION  FOR  TEMPORARY  TOTAL  DISABILITY 

Act  of 
Oct.  6,  1917     Amendment 

For  a  single  man _$30.00  $  80.00 

For  a  man  and  wife 45.00  90.00 

For  a  man,  wife  and  one  child 55.00  95.00 

For  a  man,  wife  and  two  children 65.00  100.00 

For  a  man,  wife  and  three  children 75.00  100.00 

For  a  man  and  one  child,  no  wife 40.00  90.00 

For  a  man  and  two  children 50.00  95.00 

For  a  man  and  three  children 60.00  100.00 

For  each  dependent  parent 10.00  10.00 

35 


A  percentage  of  the  amount  payable  to  a  man  for  tem- 
porary total  disability  is  granted  to  those  who  are  suffering 
from  temporary  partial  disabilities.  No  injured  veteran  re- 
ceiving compensation  is  required  to  make  any  contribution 
from  his  award  in  order  that  his  wife  and  children  may 
receive  their  allowances.  Benefits  are  paid  whether  or  not 
the  injured  man  carries  a  Government  insurance  policy.  We 
must  emphasize  the  fact  that  compensation  and  insurance 
are  separate  and  distinct.  The  Government  gives  the  com- 
pensation and  the  service  man  pays  for  his  insurance.  Com- 
pensation is  payable  for  temporary  disability  as  well  as  for 
permanent  disability,  while,  insurance  is  payable  only  be- 
cause of  death  or  permanent  and  total  disability. 

As  stated  previously,  compensation  is  payable  for  injury 
or  for  disease  contracted  by  an  officer  or  enlisted  man  while 
in  active  service.  But  the  disability  resulting  from  such 
injury  or  disease  must  have  produced  a  disability  rated  at 
ten  per  cent  or  more. 

A  more  detailed  explanation  of  the  conditions  governing 
the  paying  of  compensation  for  temporary  disabilities  is  nec- 
essary. The  first  condition  wrhich  must  be  fulfilled  is  that 
proof  be  offered  showing  that  the  injury  really  occurred 
while  the  claimant  was  in  active  service.  Active  service 
covers  that  period  between  the  date  of  induction  by  a  local 
draft  board  and  the  date  of  discharge  or  indefinite  furlough. 
Of  course  a  disability  must  have  occurred  while  the  claim- 
ant was  acting  in  line  of  duty,  if  he  is  to  be  eligible  for 
compensation. 

Even  when  the  above  conditions  are  fulfilled,  compensa- 
tion is  not  paid  automatically.  The  injured  man  must  first 
make  written  application  for  the  same.  This  formal  appli- 
cation must  be  executed  within  five  years  of  the  date  of  in- 
jury or  discharge.  However,  there  is  provision  for  one  ex- 
ception. Any  man  is  privileged  within  one  year  after  his 
discharge  to  present  himself  for  medical  examination  by  a 
designated  physician  of  the  Bureau  of  War  Risk  Insurance. 
Though  his  disability  at  the  time  of  his  examination  may 
not  be  serious  he  is  given  a  medical  certificate  setting  forth 
in  detail  his  physical  condition.  The  purpose  of  such  exam- 
inations is  to  safeguard  the  interests  of  all  veterans  and  also 
to  protect  the  Government  against  fraudulent  claims  in  the 
future.  The  holder  of  such  a  disability  certificate  may  file  a 
claim  for  compensation  at  any  time  that  his  disability  in- 
capacitates him. 

All  applicants  for  compensation  are  required  to  furnish 
the  following  information  in  order  that  they  may  be  identi- 
fied with  the  service:  name,  rank  and  organization,  date  of 
enlistment,  date  of  discharge  and  home  address.  It  is  im- 

36 


perative  that  the  claimant  file  his  original  discharge  or  a 
copy  of  the  same  with  his  application.  He  must  also  make 
known  his  previous  occupation,  the  wages  he  received  and 
the  name  of  his  employer,  his  present  occupation  (if  any) 
and  the  wages  that  he  is  capable  of  earning  and  the  name  of 
his  employer. 

With  these  facts  on  hand  the  Bureau  can  more  readily 
dispose  of  any  claim.  The  general  procedure  is  to  institute 
an  investigation  of  the  claimant's  service  record.  While  this 
investigation  is  being  made,  the  claimant  is  ordered  to  re- 
port to  a  designated  physician  for  a  physical  examination. 
The  service  record  having  disclosed  the  military  history  of 
the  claimant  and  the  physical  examination  having  shown 
him  to  be  disabled,  compensation  is  awarded.  The  amount 
is  determined  by  the  extent  of  his  personal  disability  and 
by  the  effect  that  similar  disabilities  usually  have  on  the 
earning  capacity  of  civilians  engaged  in  like  occupations. 

Suppose  the  medical  evidence  shows  a  man  to  be  tem- 
porarily totally  disabled.  He  would  be  entitled  to  $80.00  a 
month  during  the  period  of  such  total  disability.  If  he  has 
a  wife  and  child,  he  is  required  to  prove  their  relationship 
and  then  his  award  is  increased  to  $95.00  a  month.  If  his 
ailment  responds  to  treatment  furnished  by  the  Government 
and  he  is  able  to  take  up  an  occupation  which  does  not 
pay  him  as  much  as  his  former  one,  his  award  is  only 
partially  decreased.  If  after  a  period  his  disability  is  en- 
tirely removed,  his  compensation  is  withdrawn,  but  this 
does  not  usually  occur  until  the  medical  evidence  in  the 
case  offers  definite  assurance  that  the  disability  has  been 
removed.  The  Bureau  has  followed  the  policy  of  continu- 
ing payments  for  a  short  time  after  the  claimant  has  re- 
covered in  order  to  encourage  him  in  his  efforts  to  regain 
his  economic  independence. 

The  Bureau  has  found  it  more  advantageous  to  pay  full 
compensation  to  a  partially  disabled  man  and  order  him 
to  discontinue  his  employment.  The  reason  for  such  action 
is  that  it  has  been  found  that  when  a  man  is  not  employed 
he  recovers  more  quickly. 

This  is  particularly  true  in  the  case  of  a  claimant  who 
is  in  the  first  stages  of  tuberculosis.  There  is  a  very  good 
chance  of  arresting  the  disease  if  the  patient  is  placed  in  an 
institution  specializing  in  the  treatment  of  tuberculosis. 
While  confined,  the  patient  as  well  as  his  family  are  paid 
the  maximum  benefits  provided  by  the  Act  for  temporary 
total  disability.  There  is  little  doubt  that  this  is  the  best 
policy  to  follow  in  the  interest  of  both  the  claimant  and  the 
Government.  Though  the  expense  is  large  during  the  period 
in  which  the  claimant  is  confined,  the  total  potential  com- 

37 


pensation  cost  to  the  Government  is  less  and  in  addition 
a  useful  citizen  is  reclaimed  for  the  state. 

Benefits  are  also  provided  for  any  individual  who  can 
prove  that  he  is  suffering  from  a  disability  which  was  aggra- 
vated by  service.  In  making  awards  on  such  claims  great 
care  must  be  exercised  to  secure  the  full  military  and  medical 
history  of  the  man.  It  will  be  recalled  that  Section  300, 
Article  III.,  provides,  "That  for  the  purpose  of  this  section 
said  officer,  enlisted  man  or  other  member  shall  be  held  and 
taken  to  have  been  in  sound  condition  when  examined, 
accepted  and  enrolled  for  service." 

The  presumption  at  the  time  that  the  Act  was  passed 
was  that  only  men  capable  of  passing  the  regular  army 
and  navy  physical  examinations  would  be  enrolled  for  serv- 
ice. However,  we  are  all  aware  of  the  fact  that  it  became 
necessary  from  time  to  time  to  lower  these  standards.  The 
need  for  men  in  the  Army  became  so  great  that  many  were 
taken  who  were  not  physically  perfect.  These  men  were 
employed  in  various  duties,  here  and  abroad,  not  of  an  active 
fighting  nature.  However,  the  tasks  assigned  to  them  often 
resulted  in  aggravating  their  particular  disabilities. 

As  their  condition  was  more  serious  when  they  were  dis- 
charged it  is  apparent  that  they  were  entitled  to  compensa- 
tion. In  some  cases,  it  is  often  difficult  to  tell  whether  the 
particular  disability  was  sufficiently  aggravated  by  military 
service  to  entitle  the  claimant  to  compensation. 

There  is  another  provision  in  this  section  of  the  Act  re- 
garding which  the  public  knows  little.  It  is  the  subrogation 
of  claims.  Article  III.,  Section  313,  provides,  "If  an  injury 
or  death  for  which  compensation  is  payable  under  this 
Article  is  caused  under  circumstances  creating  a  legal  liabil- 
ity upon  some  person  other  than  the  United  States  or  the 
enemy  to  pay  damages  therefore,  the  director,  as  a  condi- 
tion to  payment  of  compensation  by  the  United  States,  may 
require  the  beneficiary  to  assign  to  the  United  States  any 
right  of  action  he  may  have  to  enforce  such  liability  of  such 
other  person.  .  .  ." 

One  case  will  be  sufficient  to  illustrate  the  meaning  and 
the  application  of  this  clause.  A  soldier  was  killed  in  a 
railroad  wreck,  and  left  a  wife  and  child  without  support. 
His  dependents  claimed  compensation  because  of  his  death, 
which  occurred  while  he  was  in  active  service.  Their  claim 
was  just  and  covered  by  the  Act,  therefore,  the  wife  was 
granted  compensation  at  the  rate  of  $45.00  a  month  for 
herself  and  child.  This  soldier  met  his  death  through  the 
negligence  of  the  railroad  company.  In  order  to  receive 
compensation  the  wife  was  required  to  assign  her  right  of 
action  against  the  railroad  to  the  Government.  The  Govern- 

38 


ment  received  in  damages  from  the  road  a  sum  greater  than 
the  total  payments  due  the  wife  and  child  under  the  Act; 
it  paid  the  entire  sum  of  the  damages  collected  to  the  de- 
pendents and  discontinued  their  compensation  payments. 

It  is  evidently  advantageous  to  any  person  who  may  have 
a  right  to  compensation  and  also  a  claim  against  a  third 
party  for  injuries  to  assign  such  a  claim  to  the  Government. 
By  such  action  the  Government  is  spared  an  unjustifiable 
expense  and  the  dependent  has  nothing  to  lose,  for  should 
the  damages  recovered  be  less  than  the  compensation  pro- 
vided, the  compensation  payments  are  continued,  while  if 
the  damages  exceed  the  total  of  the  compensation  payments, 
such  damages  are  paid  to  the  dependent.  There  have  been 
comparatively  few  subrogation  cases,  but  owing  to  the  fact 
that  over  four  hundred  have  arisen,  it  was  thought  advis- 
able to  include  them  in  this  monograph. 

In  the  foregoing  pages,  the  writer  has  attempted  to  ex- 
plain the  conditions  governing  the  payment  of  compensa- 
tion. The  barriers  to  payment  of  compensation  will  now 
be  briefly  enumerated.  A  dishonorable  discharge  from  any 
branch  of  the  service  forever  bars  the  recipient  of  such  a 
discharge  and  his  dependents  from  all  compensation  bene- 
fits. Death,  injury  or  disease  caused  by  wilful  misconduct 
are  not  compensable.  Neglect  to  secure  a  disability  certifi- 
cate within  one  year  after  discharge  will  bar  a  veteran  in 
later  life  from  compensation  benefits.  Claims  must  be  filed 
because  of  death  or  disability,  within  five  years  after  such 
death  or  following  the  occurrence  of  such  disability.  No 
person  in  receipt  of  service  or  retirement  pay  can  be  paid 
compensation  under  this  Act.  A  person  refusing  to  submit 
to  medical  or  surgical  treatment,  when  directed  to  do  so 
by  an  authorized  agent  of  the  Bureau  of  War  Risk  Insur- 
ance, is  barred  from  the  benefits  provided  by  the  Act. 

The  total  number  of  disability  compensation  claims  al- 
lowed to  June  30,  1921,  was  183,648.  Of  this  number, 
49,276  awards  have  been  closed  for  various  reasons.  For 
instance,  during  the  first  six  months  of  the  year  1920, 
claimants  to  the  number  of  15,714  had  accepted  vocational 
training,  while  2,337  had  recovered  from  their  disability. 
An  examination  of  the  134,408  active  claims  on  June  30, 
1920,  shows  that  they  were  divided  according  to  the  degree 
of  disability  as  follows:  31,476  were  for  temporary  total 
disability;  87,865  for  temporary  partial  disability;  11,863 
for  permanent  partial;  and  3,204  were  for  permanent  total 
disabilities.  The  compensation  payable  monthly  on  these 
134,408  claims  amounted  to  $5,036,103.91. 

An  examination  of  the  statistics  available  discloses  the  fact 
that  there  has  been  a  steady  increase  in  the  number  of  dis- 

39 


ability  compensation  claims  awarded.  In  July,  1919,  there 
were  37,754  such  claims;  in  December,  1919,  this  number 
had  increased  to  86,122;  and  on  June  30,  1920,  payments 
were  being  made  on  134,408  claims. 

The  total  number  of  claims  for  compensation  will  be  diffi- 
cult, if  not  impossible,  to  estimate.  Experts  have  estimated 
that  the  "peak  of  the  load"  will  not  be  reached  for  ten 
years  and  that  $5,000,000,000  will  have  to  be  spent  in  the 
solution  of  the  problem.  One  way  of  attempting  to  esti- 
mate the  probable  number  of  disability  claims  that  will 
arise  is  by  considering  the  number  of  invalid  pension  claims 
paid  to  disabled  veterans  of  the  Civil  War.  During  the 
thirty-six  years  following  the  Civil  War  579,115  invalid  pen- 
sion claims  were  allowed  for  an  army  of  2,400,000  men.  If 
the  same  proportion  holds  good,  there  should  be  a  total  of 
1,209,950  disability  compensation  claims  filed  in  the  year 
1956  by  the  5,041,470  men  that  served  in  the  War  of  1917. 

The  actual  disbursement  made  by  the  Bureau  in  the  pay- 
ment of  compensation  awards,  including  burial  awards  and 
medical  care  from  October  6,  1917,  to  June  30,  1920,  was 
$114,756,422.84. 

Every  precaution  has  been  taken  to  protect  this  vast  army 
of  sufferers  and  dependents  from  unscrupulous  claim  at- 
torneys. Any  man  or  woman  capable  of  reading  and  writing 
should  be  able  to  prosecute  his  or  her  claim.  However, 
should  any  such  person  consider  that  the  services  of  an 
attorney  are  necessary  in  prosecuting  a  claim,  the  Act  pro- 
vides that  no  individual  shall  charge  a  fee  in  excess  of 
$3.00  for  executing  the  papers  necessary  in  making  claim 
for  compensation. 

In  order  that  these  compensation  payments  granted  to 
disabled  men  and  the  dependents  of  those  who  made  the  su- 
preme sacrifice  may  be  secure  forever,  the  Act  provides  that 
such  payments  be  free  from  all  taxation,  shall  not  be  as- 
signable, and  shall  not  be  subject  to  the  claims  of  creditors. 


40 


Ill 

MEDICAL   CARE   AND   TREATMENT 

Modern  compensation  legislation  recognizes  the  right  of 
an  injured  person  to  all  necessary  medical  treatment  and 
care.  There  are  two  reasons  for  such  a  provision:  in  the 
first  place,  it  is  only  humane  to  provide  for  the  relief  of 
those  suffering  from  physical  pain  and  impairment  of  mind 
or  body  and,  secondly,  it  is  the  most  economic  policy  to 
follow!  Experience  has  shown  that  it  is  a  good  business 
policy  to  provide  an  injured  workman  with  adequate  medi- 
cal care  immediately  followinjg  his  injury,  because  such 
treatment  will  more  quickly  restore  him  to  his  productive 
position.  Thus  this  policy  is  of  advantage  to  the  injured 
employee,  to  his  employer,  and  to  the  state  at  large. 

The  committee  that  drew  up  the  Soldiers  and  Sailors 
Insurance  Act  realized  the  justice,  as  well  as  the  expediency, 
of  making  provision  in  the  Act  for  medical  care  and  treat- 
ment for  all  those  who  might  be  injured  or  might  contract 
disease  in  the  military  or  naval  service  of  the  nation.  Ac- 
cordingly we  find  in  Article  III.,  Section  302,  Paragraph  3, 
of  the  original  Act  the  following:  "In  addition  to  compensa- 
tion above  provided,  the  injured  person  shall  be  furnished  by 
the  United  States  such  reasonable  governmental  medical, 
surgical,  and  hospital  services  and  with  such  supplies,  in- 
cluding artificial  limbs,  trusses,  and  similar  appliances,  as 
the  director  may  determine  to  be  useful  and  reasonably 
necessary." 

Thus,  any  person  who  suffered  an  injury  or  contracted 
a  disease  or  whose  impaired  physical  condition  was  aggra- 
vated by  service  in  the  Army,  Navy,  or  Marine  Corps,  is  en- 
titled to  all  reasonable  medical  and  surgical  care  and  treat- 
ment. This  of  course,  does  not  include  persons  who  sus- 
tained injuries  or  contracted  disease  through  their  own  wil- 
ful misconduct  or  contracted  disease  when  they  were  not 
acting  in  line  of  duty. 

The  officials  of  the  Bureau  of  War  Risk  Insurance  had  no 
idea  that  the  men  disabled  in  the  service  would  be  dis- 

41 


charged  until  they  had  received  the  maximum  improvement. 
Therefore,  the  Bureau  found  itself  in  the  days  immediately 
following  the  signing  of  the  Armistice,  in  the  position  of 
having  thousands  of  disabled  men  in  need  of  medical  care 
and  hospitalization  upon  its  hands. 

Two  great  problems  to  be  met  were:  First,  to  build  up 
a  medical  force  in  Washington  and  in  the  field  to  examine 
these  men  in  order  to  determine  the  extent  of  their  dis- 
abilities, and  secondly,  a  hospitalization  program  had  to  be 
laid  out. 

The  Sixty-Fifth  Congress  aided  the  Bureau  by  the  passage 
of  Public  Act  No.  326,  which  provided  that  the  United  States 
Public  Health  Service  should,  "provide  immediate  hospital 
and  sanitorium  facilities  for  the  care  and  treatment  of  dis- 
charged sick  and  disabled  soldiers,  sailors,  and  marines, 
Army  and  Navy  nurses  (male  and  female)  patients  of  the 
War  Risk  Insurance  Bureau." 

Under  the  provisions  of  this  Act,  the  United  States  Public 
Health  Service  became  the  agency  through  which  the  Direc- 
tor of  the  Bureau  of  War  Risk  Insurance  might  obtain  medi- 
cal care  and  treatment  for  the  disabled  veterans  of  the  World 
War.  Furthermore,  the  Chief  Medical  Advisor  of  the  Bureau 
of  War  Risk  Insurance  and  all  his  subordinates  are  officers 
of  the  United  States  Public  Health  Service. 

In  order  to  care  for  that  vast  army  maimed  and  diseased 
during  the  Great  War,  which  is  domiciled  in  all  sections  of 
the  country,  the  United  States  has  been  divided  into  four- 
teen medical  districts,  each  with  at  least  one  medical  officer 
of  the  United  States  Public  Health  in  charge.  Each  of  these 
officers  has  a  corps  of  specialists  as  advisors  and  consult- 
ants. These  assistants  include  neurologists  to  care  for  ner- 
vous and  mental  cases,  general  surgeons,  orofacial  surgeons, 
neuro-surgeons,  and  orthopedists.  They  are  assisted  by 
specialists  in  clinical  work  who  aid  in  making  examinations. 
Bacteriologists,  X-ray  experts,  and  numerous  other  labora- 
tory assistants  make  up  the  corps  necessary  to  care  for  the 
injured  and  diseased  veterans  who  are  entitled  to  care  under 
the  provisions  of  the  Soldiers'  and  Sailors'  Insurance  Act. 
In  addition  to  the  above  named  corps,  it  has  been  neces- 
sary to  engage  over  one  thousand  former  medical  officers 
of  the  Army  and  Navy.  These  men  conduct  examinations 
on  a  fee  basis  in  their  respective  communities.  By  this 
policy,  former  service  men  are  not  required  to  travel  long 
distances  in  order  to  secure  a  medical  examination. 

From  the  above  it  is  apparent  that  the  medical  activities 
of  the  Bureau  of  War  Risk  Insurance  are  a  function  of  the 
United  States  Public  Health  Service.  The  district  super- 
visors are  charged  with  the  duty  of  caring  for  disabled  vet- 

42 


erans  in  addition  to  looking  out  for  the  general  health  of  the 
communities  wherein  they  are  stationed. 

The  medical  care  and  hospitalization  of  all  disabled  ex- 
service  men  is  divided  between  the  Bureau  of  War  Risk 
Insurance  and  the  United  States  Public  Health  Service.  The 
War  Risk  Bureau  is  liable  for  the  eligibility  of  patients  of 
the  Bureau  to  compensation  and  treatment,  and  for  the  pay- 
ment of  all  bills  incident  to  the  performance  of  these  obli- 
gations. 

The  United  States  Public  Health  Service  is  responsible 
for  the  medical  and  surgical  treatment  and  hospitalization 
of  all  patients  of  the  Bureau  of  War  Risk  Insurance.  Fur- 
thermore, these  district  supervisors  act  as  the  field  repre- 
sentatives of  the  Medical  Division  of  the  Bureau  of  War  Risk 
Insurance.  They  have  been  the  only  means  by  which  the 
Bureau  of  War  Risk  Insurance  has  legally  been  able  to  get 
in  touch  with  ex-service  men  in  all  parts  of  the  country, 
and  to  secure  for  them  the  services  they  need. 

The  extent  of  the  medical  service  being  rendered  may  be 
realized  when  we  consider  that  at  the  present  time  there 
are  over  23,000  disabled  ex-service  men  and  women  being 
cared  for  in  more  than  one  thousand  hospitals  throughout 
the  United  States.  Of  this  number  17,116  are  in  hospitals 
owned  or  operated  by  the  Government  and  6,207  are  in  pri- 
vate hospitals,  including  state  and  county  sanatoriums.  In 
New  York  State,  for  instance,  in  1920,  there  were  1,860  Gov- 
ernment patients  and  they  were  cared  for  in  148  hospitals. 
These  patients  were  divided  into  three  hospital  groups; 
tuberculosis,  neuro-psychiatric,  and  general.  Of  the  total 
number,  335  were  in  43  tuberculosis  hospitals,  862  in  33 
neuro-psychiatric  hospitals,  and  663  in  72  general  hospitals. 

In  addition  to  hospital  treatment,  "out-patients"  treatment 
is  being  given.  In  order  to  provide  such  treatment  and  con- 
duct proper  medical  examinations,  three  hundred  officers 
of  the  United  States  Public  Health  Service  have  been  detailed 
to  the  following  offices  established  in:  Boston,  Massachu- 
setts, to  care  for  patients  in  the  States  of  Maine,  New  Hamp- 
shire, Vermont,  Massachusetts,  and  Rhode  Island;  in  New 
York  City,  to  care  for  patients  in  Connecticut,  New  York, 
and  New  Jersey;  in  Philadelphia,  Pa.,  to  care  for  patients  in 
Delaware  and  Pennsylvania;  in  Washington,  D.  C.,  to  care 
for  patients  in  Maryland,  Virginia,  West  Virginia,  and  the 
District  of  Columbia;  in  Atlanta,  Ga.,  to  care  for  patients 
in  North  Carolina,  South  Carolina,  Tennessee,  Georgia,  and 
Florida;  in  New  Orleans,  La.,  to  care  for  patients  in  Ala- 
bama, Mississippi,  and  Louisiana;  in  Cincinnati,  Ohio,  to 
care  for  patients  in  Indiana,  Ohio,  and  Kentucky;  in  Chicago, 
Illinois,  to  care  for  patients  in  the  States  of  Wisconsin, 

43 


Michigan,  and  Illinois;  in  St.  Louis,  Mo.,  to  care  for  patients 
in  Nebraska,  Iowa,  Kansas,  and  Missouri;  in  St.  Paul,  Minn., 
to  care  for  patients  in  Minnesota,  North  Dakota,  South  Da- 
kota, and  Montana;  in  Denver,  Colo.,  to  care  for  patients  in 
Wyoming,  Utah,  Colorado,  and  New  Mexico;  in  San  Fran- 
cisco, Calif.,  to  care  for  patients  in  Arizona,  Nevada,  and  Cali- 
fornia; in  Seattle,  Washington,  for  patients  in  the  States  of 
Idaho,  Oregon,  and  Washington;  and  in  Houston,  Texas,  for 
patients  resident  of  the  States  of  Oklahoma,  Texas,  and 
Arkansas.  Offices  have  also  been  established  at  Manila  to 
care  for  the  Philippines;  at  San  Juan  for  the  Island  of  Porto 
Rico  and  the  Virgin  Islands,  and  at  Honolulu  for  patients  in 
the  Hawaiian  Islands.  The  number  of  persons  receiving  "out- 
patient*' treatment  has  steadily  increased,  as  there  were  only 
4,500  on  August  1,  1919,  while  on  January  1,  1920,  the  num- 
ber had  increased  to  10,229.  Of  this  number  3,654  were 
suffering  from  tuberculosis,  3,416  from  nervous  and  mental 
diseases,  and  3,159  were  general  cases. 

The  prosthetic  devices  furnished  to  the  patients  of  the 
Bureau  of  War  Risk  Insurance  include  2,194  artificial  limbs, 
consisting  of  1,784  permanent  artificial  legs  and  1,130  per- 
manent artificial  arms.  During  the  war  there  were  some 
3,800  major  amputations  of  which  2,280  were  of  lower  limbs 
and  1,520  of  the  upper  ones.  All  of  these  men  will  be  fur- 
nished with  permanent  artificial  devices  as  soon  as  their 
amputated  limbs  are  completely  healed. 

The  question  of  hospitalization  has  been  a  very  serious 
one.  The  demand  for  hospital  facilities  to  care  for  these 
men  and  women  has  been  very  large  and  has  constituted 
a  real  emergency.  In  order  to  meet  this  situation,  the  United 
States  Public  Health  Service  has  expanded  its  facilities,  and 
additional  accommodations  have  been  secured  by  the  appro- 
priations of  Congress.  At  the  close  of  the  fiscal  year  1919, 
the  Public  Health  Service  was  operating  20  marine  hospi- 
tals and  10  new  hospitals  were  opened  during  that  year. 
The  Public  Health  Service  also  made  a  canvas  of  the  beds 
available  in  civil  and  private  hospitals  and  institutions.  On 
April  15,  1919,  this  canvas  showed  that  there  were  619  civil 
hospitals  with  9,208  beds  available  for  discharged  men. 
By  June  30th,  the  reported  facilities  had  increased  to  1,913 
hospitals  representing  26,850  beds.  The  number  of  War 
Risk  patients  in  those  hospitals  on  that  date  were  9,590.  A 
number  of  those  hospitals  were  taken  over  as  contract  hos- 
pitals while  others  were  returned  as  unsuitable. 

On  June  30,  1920,  there  were  in  the  United  States  Public 
Health  hospitals  2,467  tuberculosis  patients,  1,660  neuro- 
psychiatric  patients,  and  3,754  patients  grouped  under  the 
classification  of  general  medicine.  In  private  institutions, 

44 


there  were  3,551  tuberculosis  patients,  3,382  neuro-psychia- 
tric  patients,  and  2,657  general  medicine  patients.  The  total 
number  of  patients  admitted  to  all  of  these  hospitals  for 
the  fiscal  year  ending  June  30,  1920,  was  48,983.  Of  this 
total  24  per  cent,  or  11,819,  were  suffering  from  tuberculosis; 
12  per  cent,  or  5,707,  because  of  diseases  of  the  digestive 
organs;  and  11  per  cent,  or  5,203,  because  of  diseases  of  the 
mind. 

The  number  of  veterans  requiring  hospitalization  has  been 
on  the  increase  and  it  is  apparent  that  at  the  close  of  the 
fiscal  year  of  1920-1921  there  will  be  30,000  men  demanding 
hospital  accommodations.  It  is  evident,  therefore,  that  the 
problem  of  providing  medical  care  and  treatment  for  the 
veterans  of  the  Great  War  has  only  begun. 

In  order  that  all  persons  entitled  to  such  treatment  might 
receive  it,  it  was  necessary  for  Congress  on  June  30,  1920, 
to  appropriate  $46,000,000.  When  making  the  appropria- 
tion it  was  directed  that  the  money  be  expended  by  the 
Bureau  of  War  Risk  Insurance  for  medical,  surgical,  and 
hospital  services;  medical  examinations,  funeral  expenses, 
traveling  expenses,  and  supplies  for  the  beneficiaries  of  the 
Act  of  October  6,  1917.  The  Sundry  Civil  Bill  providing  for 
this  appropriation  authorized  the  use  of  the  hospital  facil- 
ities of  the  Army,  Navy,  and  the  National  Soldiers'  Home. 

The  intention  of  the  Government,  at  the  present  time,  is 
to  centralize  its  patients  suffering  from  similar  disabilities  in 
highly  specialized  institutions.  However,  in  localities  where 
Government  owned  and  operated  hospitals  are  not  available, 
it  does  not  intend  to  interfere  with  the  use  of  contract  hos- 
pitals which  are  used  solely  for  the  purpose  of  obtaining 
satisfactory  examinations  of  patients.  In  the  future,  patients 
may  be  admitted  to  civilian  or  private  hospitals  and  kept 
there  until  they  have  been  examined.  Should  the  exami- 
nation of  any  one  of  these  patients  show  that  he  is  in  need 
of  care  and  treatment,  it  is  intended  that  he  shall  be  trans- 
ferred to  a  Government  institution  equipped  to  care  for  the 
individual's  particular  complaint. 

An  examination  has  been  made  of  the  facilities  available 
in  the  National  Soldiers'  Home.  It  has  been  decided  to  con- 
vert two  of  these  homes  into  tuberculosis  sanatoriums,  and 
a  third  into  a  sanatorium  for  the  care  and  treatment  of 
nervous  and  mental  cases.  Each  of  the  tuberculosis  sana- 
toriums will  be  capable  of  caring  for  one  thousand  patients, 
and  it  will  be  expected  that  the  sanatoriums  for  mental 
diseases  will  be  capable  of  accommodating  a  like  number. 
The  survey  of  all  the  Government  institutions  has  disclosed 
the  fact  that  the  Government  will  be  in  the  position  to  care 
for  fourteen  thousand  patients  in  its  own  institutions.  In 

45 


addition  the  United  States  Public  Health  Service  has  agreed 
to  furnish  fifteen  thousand  beds. 

There  has  been  some  criticism  of  this  new  policy  of  the 
centralization  of  patients  in  Government  institutions,  but  it 
is  believed  by  the  leading  medical  authorities  to  be  the  only 
efficient  manner  of  caring  for  this  vast  and  ever  increasing 
army  of  diseased  and  disabled  veterans.  Under  this  new 
system  it  would  appear  that  a  man  would  secure  the  expert 
treatment  which  his  case  would  require.  It  will  be  possible 
to  have  highly  trained  men  detailed  at  particular  institu- 
tions, while  formerly  it  was  not  always  possible  to  send 
these  experts  to  different  parts  of  the  country  to  care  for  a 
single  patient.  The  Government  is  also  eager  to  place  all 
claimants  in  its  own  institutions,  because  often  in  the  past 
it  was  forced  to  withdraw  patients  confined  in  private  insti- 
tutions. The  authorities  of  some  private  institutions  de- 
manded the  Government  release  certain  beds  for  the  use  of 
residents  of  the  immediate  district.  In  the  future,  once  a 
patient  is  placed  in  a  Government  hospital  he  will  not  be  re- 
moved until  he  is  cured  or  at  least  convalescent. 

Medical  care  and  treatment  in  proper  hospitals  appears  to 
be  the  greatest  problem  that  the  Bureau  of  War  Risk  Insur- 
ance has  to  meet  at  the  present  time.  The  Surgeon  General 
of  the  United  States  Public  Health  Service  reported  that  on 
January  1,  1921,  there  were  19,019  patients  of  the  Bureau  of 
War  Risk  Insurance  receiving  treatment.  Of  this  number 
he  estimated  that  7,586  were  suffering  from  tuberculosis; 
5,690  with  mental  diseases;  and  5,743  with  medical  and  sur- 
gical disabilities. 

Dr.  Thomas  Salmon,  a  neuro-psychiatric  expert,  estimates 
that  there  are  71,237  ex-service  men  suffering  from  mental 
disorders,  but  that  only  5,000  have  come  to  the  Government 
for  treatment. 

Experts  in  tuberculosis  have  estimated  that  38,033  men 
were  discharged  from  the  service  suffering  from  tubercu- 
losis. The  Bureau  of  War  Risk  Insurance  admits  that  only 
9,543  men  were  being  treated  for  tuberculosis  in  January, 
1921. 

Senator  Arthur  Capper  informed  Congress  that  641,000 
men  were  disabled  during  the  war.  He  stated  that  46,310 
were  discharged  as  tubercular;  76,588  had  nervous  or  mental 
ailments;  75,000  were  in  need  of  surgical  attention,  and  62,- 
869  had  something  wrong  with  their  eyes,  ears,  nose,  or 
throat.  Senator  Capper  also  estimated  that  the  number  of  ex- 
service  men  demanding  medical  attention  are  increasing  at 
the  rate  of  5,000  a  month,  and  that  the  peak  of  the  problem 
will  not  be  reached  for  ten  years.  He  believes  that  the  num- 
ber of  veterans  who  must  have  medical  care  and  treatment 

46 


will  increase  from  20,000  at  one  time  to  50,000  at  a  later  date 
The  War  Risk  Insurance  Bureau  reported  on  January  27, 
1921,  a  total  of  23,323  soldiers  in  various  Government  or 
private  hospitals  undergoing  treatment.  Of  this  total,  9,543 
were  suffering  from  tuberculosis;  6,101  were  neuro-psychia- 
tric  patients;  and  7,677  were  classified  as  general  and  sur- 
gical cases.  Of  the  total  23,323  patients,  only  17,116  were 
being  treated  in  Government  hospitals.  Dr.  Haven  Emerson, 
chief  of  the  medical  division  of  the  Bureau  of  War  Risk  In- 
surance, stated  in  April,  1921,  that  35,000  beds  will  be  needed 
for  former  service  men  between  1925  and  1927. 


47 


IV 

PENSIONS  IN  THE  UNITED  STATES  AND  FOREIGN 
COUNTRIES 

It  makes  an  interesting  digression,  after  this  lengthy  treat- 
ment of  the  benefits  provided  by  our  present  compensation 
law,  to  state  briefly  the  benefits  granted  under  our  former 
pension  laws  and  those  contained  in  the  pension  laws  that 
obtain  at  the  present  time  in  foreign  countries.  A  lengthy 
treatment  of  our  former  laws  would  be  superfluous  as  there 
is  already  a  considerable  body  of  literature  on  the  subject. 
Therefore,  we  will  examine  them  in  a  concise  manner  under 
the  three  general  classifications:  Retirement  System,  The 
General  Laws  System,  and  The  Service  Pension  System. 

The  Retirement  System  provided  for  the  retirement  of  any 
officer  or  enlisted  man,  at  three-quarters  pay,  after  thirty 
years  of  service  in  the  Regular  Establishment  of  the  Army, 
Navy,  Marine  Corps,  and  Coast  Guard.  This  was  the  gen- 
eral condition,  but  there  were  conditions  under  which  a  man 
might  be  retired  before  he  had  served  thirty  years.  An 
officer  was  automatically  pensioned  upon  reaching  the  age 
of  sixty-four  years.  An  officer  can  be  retired  at  any  time 
by  the  President  of  the  United  States. 

Pensions  and  pension  legislation  did  not  play  an  impor- 
tant part  in  the  history  of  the  United  States  until  after  the 
outbreak  of  the  Civil  War.  The  total  expenditures  for  pen- 
sions in  the  year  1861  was  only  $1,072,000  and  the  number 
of  beneficiaries  were  10,700. 

The  General  Law  Pension  System  was  created  by  the  Act 
of  Congress  of  July  14,  1862.  This  system  became  the  funda- 
mental law  for  all  pension  claims  arising  out  of  disability 
or  death  due  to  military  service  after  March  1,  1861.  It 
embraced  within  its  provisions  officers  and  enlisted  men  of 
the  Army  and  Navy,  including  regulars,  volunteers,  militia, 
and  marine  corps. 

This  Act  of  July  14,  1862  provided  pensions  for  soldiers 
who  had  incurred  permanent  bodily  injury  or  disability  in 
the  military  service  after  March  1,  1861.  The  claimant  was 
required  to  show  that  his  disability  was  incurred  as  a  direct 
consequence  of  his  military  duty.  This  Act  also  provided 
for  the  widows,  children,  and  other  dependents  of  soldiers 

48 


who  died  in  the  service,  or  from  causes  that  could  be  directly 
traced  to  the  service. 

Numerous  disability  pension  acts  have  been  passed  from 
time  to  time.  Each  succeeding  act  has  been  an  expression 
of  the  liberality  of  the  American  people  to  those  men  who 
served  in  the  Civil  War.  The  benefits  have  been  increased 
so  that  by  the  year  1916  the  minimum  pension  payable  for 
any  disability  was  $6.00  a  month  and  the  maximum  was 
$100,  payable  for  any  of  the  following  specific  disabilities: 
the  loss  of  both  hands,  the  loss  of  both  feet,  the  loss  of  the 
sight  of  both  eyes,  the  loss  of  the  sight  of  one  eye,  (the  other 
having  been  lost  before  enlistment). 

Pensions  to  widows  were  increased  from  $8.00  in  1862, 
to  $20.00  by  the  Act  of  September  8,  1916,  and  to  $25.00  a 
month  by  Section  314  of  the  Act  of  October  6,  1917.  An  addi- 
tional pension  of  $2.00  a  month  was  allowed  for  every  child 
under  the  age  of  sixteen  years. 

An  interesting  contrast  with  this  "General  Law  Pension 
System,"  is  the  so-called  "Service  Pension  System,"  which 
was  inaugurated  in  1890.  The  purpose  of  the  Act  of  June 
27,  1890,  and  subsequent  acts  of  like  nature,  was  to  provide 
pensions  for  all  persons  who  had  rendered  service  during 
the  Civil  War,  and  who  were  not  in  perfect  physical  condi- 
tion. It  granted  pensions  to  all  persons  who  could  show 
proof  that  they  had  served  ninety  days  or  more,  had  been 
honorably  discharged,  and  were  suffering  from  a  disability 
not  necessarily  incurred  in  military  service.  Benefits  were 
also  provided  for  the  widows  and  children  of  all  Civil  War 
soldiers  without  regard  to  cause  or  nature  of  the  soldier's 
death. 

In  1908  an  Act  was  passed  that  increased  widows'  pensions 
to  $12.00  a  month.  This  applied  to  the  widows  of  all  vet- 
erans who  had  served  in  the  Civil  War  for  ninety  days  or 
more — provided  they  had  been  married  before  June  27,  1890. 
A  pension  was  granted  to  all  such  widows  irrespective  of 
their  pecuniary  condition.  Because  of  the  liberality  of  this 
Act  it  tended  to  supersede  the  Act  of  1890.  The  Acts  of 
1907  increasing  the  amount  of  pension  for  veterans  and  the 
Act  of  1908  increased  the  expenditures  for  pensions  by 
nearly  $32,000,000. 

On  May  11,  1912,  a  service-and-age  pension  act  was  passed 
by  Congress.  This  Act  granted  pensions  to  the  veterans  of 
the  Civil  War  according  to  the  claimant's  age  and  his  length 
of  service.  Since  the  provisions  of  this  Act  were  more 
liberal  than  any  preceding  Act  it  promptly  superseded  the 
most  favorable  of  them.  The  expenditures  were  correspond- 
ingly increased.  In  1912  pension  payments  amounted  to 
$152,986,000,  while  in  the  year  1913  they  reached  their  high- 

49 


est  point  $172,409,000.  On  the  other  hand  the  number  of 
pensioners  on  the  rolls  in  1913  were  820,200  as  compared 
to  999,446  in  1902. 

The  United  States  paid  out  in  pensions  the  sum  of  $5,119,- 
080,336.71  during  the  period  from  1866  to  1917.  Of  the 
Civil  War  expenditures,  more  than  $2,230,000  were  paid  out 
in  pensions  under  laws  that  required  no  proof  that  disabil- 
ity or  death  was  due  to  causes  that  originated  in  the  mili- 
tary service.  During  the  past  twenty-five  years  general  law 
pension  expenditures  have  been  decreasing  without  inter- 
ruption and  service  pension  expenditures  have  been  con- 
stantly on  the  increase. 

The  Sixty-Fifth  Congress  passed  the  Fuller  Bill  which 
provides  for  the  following  changes  and  increases  in  benefits 
for  pensioners: 

PENSIONERS  OF  THE  WAR  OF  1812 

Increase  of  widow's  pension  to $30.00  a  month 

PENSIONERS  OF  THE  MEXICAN  WAR 
To  any  veteran  who  served  sixty  days  or  more 

and  was  honorably  discharged,  a  pension  of.  __ $50.00  a  month 
To  any  veteran  who  served  sixty  days  or  more 
and  was  honorably  discharged  and  is  blind  or 
helpless,  or  who  is  so  nearly  blind  or  helpless 
as  to  be  in  need  of  a  regular  personal  aid  or  an 

attendant,  a  pension  of __ $72.00  a  month 

To  a  veteran  who  served  ninety  days  or  less,  but 
was  discharged  because  of  a  disability  incurred 
in  service  in  line  of  duty,  and  who  is  already  in 
receipt  of  a  pension  or  entitled  to  one,  a  pen- 
sion of  ___$50.00  a  month 

To  a  survivor  of  the  Mexican  War  or  to  the 
widow  of  a  veteran  of  the  Mexican  War $30.00  a  month 

PENSIONERS  OF  THE  CIVIL  WAR 

To  a  veteran  of  the  Civil  War  who  served  ninety 
days  or  more  and  was  honorably  discharged 
from  the  service. _ $50.00  a  month 

To  a  veteran  who  served  ninety  days  or  less,  but 
was  discharged  because  of  a  disability  con- 
tracted in  line  of  duty,  or  to  a  veteran  who  is 
blind  or  helpless  or  so  nearly  blind  or  helpless 
as  to  require  the  services  of  an  attendant  con- 
stantly   $72.00  a  month 

The  following  amounts  are  provided  for  those 
suffering  from  certain  specific  disabilities: 

(a)  The  loss  of  one  hand  or  one  foot  or  the 

total  disability  of  the  same $60.00  a  month 

(b)  The   loss   of   an    arm   at,   or   above,   the 

elbow  or  the  loss  of  a  leg  at,  or  above, 
the  knee  or  the  total  disability  of  the 

same    _$65.00  a  month 

50 


(c)  The  loss  of  an  arm  at  the  shoulder  joint, 

a  leg  at  the  hip  joint,  or  if  an  artificial 

limb  cannot  be  used $72.00  a  month 

(d)  The  loss  of  one  hand  and  one  foot  or 

the  total  disability  of  the  same $90.00  a  month 

An  increase  in  the  pensions  of  the  widows  of 
Civil  War  veterans  (married  prior  to  June  27, 
1905)  : 

(a)  To  a  widow  of  a  man  who  served  ninety 

days  or  more  and  was  honorably  dis- 

discharged $30.00  a  month 

(b)  To  the  widow  of  a  man  discharged  for, 

or  dying  in  the  service  from,  a  dis- 
ability incurred  in  the  line  of  duty, 
regardless  of  the  length  of  his  service. $30.00  a  month 

(c)  To  a  widow  married  once  or  more  after 

the  death  of  her  soldier  or  sailor  hus- 
band, if  the  subsequent  marriage  has 
been  dissolved  by  death,  or  divorce 

without  fault  on  her  part___ $30.00  a  month 

To  a  widow  for  each  fatherless  child  under  the 

age  of  sixteen  years $6.00  a  month 

To  the  motherless  children  of  the  deceased  man, 
a  widow's  pension  plus  the  ordinary  children's 

pension,  as  for  one  motherless  child $36.00  a  month 

To  dependent  parents $30.00  a  month 

To  Army  nurses  who  served  in  the  Civil  War_._ $30.00  a  month 

The  general  criticism  which  has  been  directed  against  our 
pension  legislation  in  the  past  was  due  to  the  fact  that  pen- 
sions were  granted  without  regard  to  the  physical  or  finan- 
cial condition  of  the  claimants.  By  the  provisions  of  the 
Act  of  1890  no  distinction  was  made  because  of  length  of 
service.  The  same  pension  was  paid  to  a  man  who  had 
served  ninety  days  as  to  one  who  had  served  during  the 
entire  period  of  the  Civil  War.  Furthermore,  this  Act  dis- 
regarded the  question  of  dependency  in  granting  a  pension. 
A  rich  merchant  or  a  prosperous  professional  man  was  en- 
titled to  the  same  benefit  as  a  broken  down,  penniless,  and 
childless  widower. 

The  contrast  between  the  compensation  benefits  provided 
by  the  Soldiers  and  Sailors  Insurance  Act  and  those  granted 
under  our  old  pension  laws  must  be  apparent  to  all.  The 
superiority  of  the  new  system  lies  in  the  fact  that  it  is 
based  on  the  principle  that  a  man  is  entitled  to  assistance, 
should  he  have  been  disabled  in  the  service  or  because  of 
service.  It  provides  for  no  pecuniary  rewards  for  the  serv- 
ices rendered  by  any  citizen  in  fulfilling  his  military  obli- 
gations in  the  defense  of  his  country.  However,  it  readily 
recognizes  the  moral,  social,  and  economic  obligation  of 

51 


the  nation  towards  those  who  did  suffer  injury  in  the  service 
and  does  provide  for  the  dependents  of  those  who  gave  their 
lives  in  service  of  the  nation.  It  aims  to  make  its  benefits 
compensate  for  the  destruction  of  productive  manpower. 

The  writer  purposes  to  mention  only  the  general  provi- 
sions contained  in  the  pension  laws  of  those  countries  with 
which  the  United  States  was  allied  during  the  recent  war. 
An  examination  of  the  foreign  laws  shows  that  their  bene- 
fits are  determined  by  the  degree  of  disability  and  the  rank 
of  the  injured  or  deceased  man.  This  policy  of  regulating 
the  pension  according  to  rank  was  formerly  the  practise  in 
the  United  States.  However,  the  Soldiers  and  Sailors  In- 
surance Act  makes  no  distinction  because  of  rank.  It  pro- 
vides the  same  benefits  for  similarly  injured  men  irrespec- 
tive of  their  military  position. 

The  tendency  in  all  these  modern  laws  to  apportion  the 
pension  to  the  decrease  in  earning  capacity  is  worthy  of  note. 
It  marks  the  introduction  of  the  philosophy  of  workmen's 
compensation  into  modern  pension  laws.  It  denotes  the 
growing  tendency  throughout  the  world  to  measure  pension 
benefits  by  the  actual  economic  loss  sustained  by  the  in- 
jured. This  evidences  a  decided  change  in  pension  legis- 
lation, as  formerly  a  pension  was  determined  by  the  de- 
crease in  a  man's  military  usefulness  or  represented  a  re- 
ward for  faithful  service. 

A  noticeable  change  in  the  administration  of  pensions 
occurred  during  the  World  War.  Before  1914  the  adminis- 
tration of  pensions  in  foreign  countries  was  in  the  hands  of 
military  authorities.  We  now  find  in  several  countries 
civilian  departments  administering  the  pension  laws.  For 
instance,  Great  Britain  has  created  a  Ministry  of  Pensions, 
and  Canada  has  established  a  Department  of  Soldiers'  Civil 
Re-establishment. 

Because  of  the  various  social  and  economic  differences 
which  exist  in  these  countries,  as  compared  with  our  own 
democratic  state,  the  writer  prefers  to  state  simply  the  ac- 
tual provisions  found  in  the  foreign  laws,  rather  than  to 
draw  any  conclusions  as  to  the  particular  advantages  or  dis- 
advantages found  in  the  law  of  any  individual  country.  Most 
of  these  countries  have  provided  pensions  for  service,  dis- 
ability, and  death.  As  our  own  compensation  law  provides 
only  for  disability  and  death  benefits,  we  will  confine  our 
examination  to  the  provisions  for  like  contingencies  found 
in  the  foreign  laws. 

Under  the  disability  pension  system  in  Great  Britain,  pen- 
sions are  payable  to  any  officer  or  enlisted  man  discharged 
from  the  service  as  medically  unfit.  Such  unfitness  must 
have  resulted  from,  or  have  been  aggravated  by,  military 

52 


or  naval  service.  The  amount  of  the  pension  is  determined 
by  the  extent  of  the  claimant's  disability,  his  rank,  and  the 
number  of  his  dependents.  In  the  event  of  the  death  of  any 
officer  or  enlisted  man,  a  pension  is  payable  to  his  depend- 
ents, the  amount  being  determined  by  the  rank  of  the  de- 
ceased and  the  number  of  his  dependents. 

Any  man  discharged  because  of  medical  unfitness,  which 
is  not  attributable  to  or  was  not  aggravated  by  service  but 
was  not  caused  by  his  own  negligence  or  misconduct,  is  en- 
titled to  a  gratuity  of  $729.98  in  lieu  of  a  pension. 

Benefits  are  provided  for  both  permanent  and  temporary 
disabilities.  Those  payable  for  permanent  disability  are 
generally  specific  and  applicable  to  certain  specific  injuries. 
These  specified  disabilities  are  about  twenty  in  number. 
Maximum  payments  are  made  for  total  and  permanent  dis- 
abilities and  a  proportionate  amount  is  paid  for  permanent 
partial  disability.  The  pension  granted  for  a  permanent  dis- 
ability is  continued  even  though  the  recipient  takes  up  a 
lucrative  occupation.  However,  temporary  disability  pay- 
ments are  continued  only  during  the  period  of  incapacity. 
The  pensions  granted  for  disabilities  are  known  as  ordinary 
pensions. 

Under  the  British  System  any  recipient  of  an  ordinary 
pension  may  change  it  for  an  alternative  pension.  An  alter- 
native pension  is  based  upon  the  actual  pre-service  earnings 
of  the  disabled  claimant.  If  the  amount  of  the  ordinary 
pension  is  less  than  a  man's  previous  earnings  he  may  de- 
mand an  alternative  pension.  However,  there  is  this  limita- 
tion, an  alternative  pension  cannot  be  substituted  for  an  or- 
dinary pension  if  the  former  calls  for  a  payment  exceeding 
25s  a  week.  Alternative  pensions  must  be  applied  for  be- 
fore December  6,  1920,  or  within  twelve  months  after  dis- 
charge from  active  service. 

Pensions  are  granted  to  the  widows,  children,  and  depend- 
ent parents  of  any  man  who  was  killed  or  died  in  the  ac- 
tive service.  As  shown  in  the  table  at  the  end  of  this  chap- 
ter a  widow's  pension  amounts  to  $253.06  a  year.  The  pay- 
ment to  a  common  law  widow  is  one-half  of  the  above  sum, 
and  is  only  paid  if  the  widow  is  able  to  prove  that  she 
was  dependent  upon  the  deceased  for  her  support,  or  is 
caring  for  his  children.  A  widow  may  demand  an  alternative 
pension  if  she  can  prove  that  her  ordinary  pension,  in  ad- 
dition to  that  payable  to  her  children,  does  not  equal  the 
pre-war  earnings  of  her  deceased  husband. 

Children,  both  legitimate  and  illegitimate,  are  entitled  to 
pensions  until  they  reach  the  age  of  sixteen  even  though 
their  mother  may  remarry  before  that  date  and  thereby 
surrender  her  pension. 

53 


Pensions  are  provided  for  parents  dependent  in  whole 
or  in  part  upon  a  deceased  son.  There  is  one  unique  fea- 
ture in  the  British  law  pertaining  to  pensions  for  dependent 
parents.  It  specifies  that  the  parent  of  any  son  who  had 
been  an  apprentice  previous  to  his  enlistment,  or  who  had 
spent  one  or  more  years  at  his  trade,  or  had  been  articled 
to  a  profession,  or  who  was  qualifying  for  a  profession  at  a 
school,  college,  university,  or  hospital,  is  entitled  to  a  pen- 
sion should  such  a  parent  become  at  any  time  incapable  of 
self  support,  by  reason  of  old  age  or  infirmity. 

The  French  System  is  similar  in  many  respects  to  the  sys- 
tem formerly  in  operation  in  the  United  States.  It  is  similar 
to  those  in  force  in  all  European  countries  to  the  extent 
that  disability  benefits  are  determined  according  to  the  rank 
of  the  disabled  veteran  and  the  degree  of  his  disability. 

The  present  French  Law  is  superior  to  the  old  ones  in 
so  far  as  it  tends  to  measure  the  pension  according  to  the 
decrease  in  the  veteran's  earning  capacity.  Formerly,  a 
pension  was  determined  by  the  decrease  in  the  disabled 
soldier's  military  usefulness. 

Pensions  are  provided  for  men  disabled  in  the  service 
and  for  certain  dependents  of  men  who  were  killed  or  who 
died  from  a  malady,  contracted  in  the  course  of  danger,  ac- 
cident, or  fatigue  of  service.  The  permanent  disability  bene- 
fits are  determined  according  to  table  providing  specific 
pensions  for  specific  disabilities.  This  table  is  long  and  ex- 
haustive, and  provides  benefits  for  practically  every  sort 
of  permanent  disability.  The  maximum  benefit  of  100  per 
cent  is  granted  for  permanent  and  total  disability  which 
amounts  to  an  annual  payment  of  $480.00  for  a  single  man. 
Partial  disabilities  are  compensated  in  percentages  of  five. 

A  distinctive  feature  of  the  French  System  is  that  it  per- 
mits a  representative  of  the  veterans  to  sit  on  the  Board  of 
Pensions  in  the  several  departments  of  the  country. 

The  conditions  regulating  the  granting  of  a  pension  to 
a  disabled  man  in  Italy  is  practically  the  same  as  in  other 
countries.  He  must  have  sustained  his  injury  in  line  of  duty 
while  acting  in  the  military  service  of  the  nation.  The  pen- 
sion is  determined  by  the  extent  of  the  disability  and  the 
number  of  dependents  the  disabled  man  is  bound  to  support. 
Widows,  children,  dependent  parents,  brothers  and  sisters 
of  a  deceased  soldier  or  sailor  are  entitled  to  pensions. 

An  illegitimate  child  is  entitled  to  a  pension  under  cer- 
tain peculiar  conditions.  Such  a  child  is  entitled  to  a  full 
pension,  providing  there  are  no  other  claimants.  If  there  be 
a  dependent  parent,  orphan  sister  or  brother  claiming  a  pen- 
sion, an  illegitimate  child  is  only  entitled  to  one-half  the  sum 
payable  to  a  legitimate  one. 

54 


A  parent  may  receive  a  pension  only,  if  and  while,  there 
is  no  widow  or  children  surviving  the  deceased.  A  full 
pension  is  payable  to  a  parent  if  he  is  able  to  prove  that  the 
deceased  was  his  main  support.  A  father  is  entitled  to  a 
pension  if  he  is  a  widower,  over  fifty  years  of  age  and  incap- 
able of  self  support.  Any  parent  becoming  destitute  within 
five  years  after  the  death  of  a  son  in  the  service,  is  entitled 
to  a  pension.  A  pension  may  be  withdrawn  from  a  parent 
at  any  time  it  can  be  proven  that  he  has  another  source  of 
income.  Of  course,  if  this  other  source  of  income  provides 
an  amount  insufficient  to  support  the  parent,  the  pension 
is  only  partially  reduced. 

The  new  Italian  Law  contains  a  disability  chart  drawn 
up  by  a  group  of  technical  experts,  medical,  legal,  and  ac- 
tuarial, and  for  precision  and  accuracy  is  considered  to  be 
most  perfect  in  existence.  This  new  law  has  replaced  and 
eliminated  the  old  rough  and  inadequate  method  of  classi- 
fying disabilities.  This  change  to  a  more  modern  and  scien- 
tific system  was  made  necessary  in  Italy,  as  in  France  and 
other  countries,  by  the  fact  that  the  Great  War  compelled 
these  nations  to  call  large  numbers  of  men  from  their  pro- 
ductive occupations,  to  supplement  and  augment  the  pro- 
fessional armies. 

The  different  British  Colonial  Governments  have  adopted 
laws  similar  to  those  in  force  in  the  mother  country.  Rank 
is  always  taken  into  consideration  in  granting  a  pension  to 
a  disabled  veteran.  The  general  aim  of  these  various  laws 
is  to  compensate  the  veterans  of  their  citizen  armies  for 
the  economic  loss  they  have  sustained  because  of  their  in- 
juries. 

Specific  amounts  are  provided  for  certain  permanent  dis- 
abilities. In  Australia  and  New  Zealand  individual  awards 
are  made  according  to  the  particular  and  personal  injuries 
sustained  by  the  claimant.  In  South  Africa  partial  disabili- 
ties are  compensated  according  to  the  Imperial  Table  for- 
merly in  use.  The  Canadian  Law  includes  benefits  for  all 
disabilities  rated  at  more  than  five  per  cent.  Those  under 
five  per  cent  are  disposed  of  by  a  gratuity  of  $100. 

It  has  proven  impossible  to  tabulate  in  a  simple  table  the 
various  provisions  of  the  present  pension  laws  in  operation. 
No  one  system  is  simple  in  itself  and  a  combination  of  all 
of  them  according  to  their  general  characteristics  would  be 
too  complex  to  be  useful.  Therefore,  only  two  simple  tables 
have  been  compiled.  The  first  contains  the  benefits  provided 
for  the  dependents  of  men  killed  in  the  service  and  the 
second  includes  the  benefits  granted  to  those  who  suffered 
injury  in  the  performance  of  their  duty. 

55 


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57 


INSURANCE 

The  third  distinctive  feature  of  the  Soldiers  and  Sailors 
Insurance  Act  was  the  provision  for  insurance.  This  pro- 
vision was  made  necessary  because  our  citizens  entering 
the  military  and  naval  service  of  the  nation,  were  compelled 
to  sacrifice  their  rights  to  the  protection  afforded  by  life 
insurance. 

There  were  two  causes  which  practically  abrogated  an 
enlisted  man's  right  to  insurance.  First,  some  insurance 
companies  held  that  a  man  entering  military  service  during 
wartime,  automatically  forfeited  all  rights  to  life  insurance. 
Secondly,  commercial  companies  were  forced  to  increase 
their  rates  because  of  the  extra  war  hazard  to  which  our 
male  population  was  exposed.  This  increase  was  so  great 
as  to  make  insurance  practically  prohibitive  for  the  ordinary 
enlisted  man.  Such  increases  in  commercial  insurance 
rates  were  justifiable  in  the  face  of  the  excessive  mortality 
suffered  by  the  Allies. 

The  Government  overcame  the  difficulty  by  deciding  to 
go  into  the  insurance  business  itself.  It  further  agreed  to 
assume  the  additional  war  risk  and  all  of  cost  of  carrying 
on  the  business,  making  it  possible  to  offer  insurance  to  the 
members  of  our  fighting  forces  at  ordinary  peace  time  rates. 
This,  of  course,  could  not  have  been  attempted  by  a  private 
company. 

The  adoption  of  Article  IV.  of  the  Soldiers'  and  Sailors' 
Insurance  Act  marked  the  commitment  of  the  United  States 
Government  to  the  principle  of  social  insurance.  Of  course, 
all  insurance  is  social,  in  so  far  as  it  is  the  substitution  of 
social  co-operation  for  individual  provision.  It  provides  for 
the  elimination  of  personal  risks  by  distributing  them  over 
the  entire  body  of  policy  holders  in  any  particular  insurance 
organization.  The  concept  of  social  insurance  may  not  be 
the  same  in  all  countries,  but  in  general  it  is  recognized  to 
be  a  system  of  insurance  participated  in  by  the  state  and  in- 
dividual citizens  of  the  state.  Protection  is  thereby  afforded 
some  particular  unit  of  the  citizen  body  which  is  not  finan- 
cially capable  of  securing  it  otherwise.  The  funds  appro- 
priated by  the  state  come  from  the  public  treasury,  and  even 
though  all  the  citizens  dp  not  participate  in  the  benefits  de- 
rived from  these  funds,  it  is  presumed  that  the  majority  of 

58 


those  not  provided  for  are  capable  of  securing  insurance 
protection  from  private  companies.  Such  an  expenditure  of 
public  money  is  justified  on  the  grounds  that  it  is  used 
in  promoting  the  general  welfare  of  the  state. 

As  to  the  best  form  of  policy  for  our  soldiers  and  sailors 
to  carry,  a  conclusion  was  reached  only  after  a  careful 
study  of  the  general  policies  sold  by  private  companies. 
After  this  study  and  an  examination  of  the  particular  bene- 
fits provided  by  different  forms  of  insurance,  it  was  decided 
that  term  insurance  was  the  most  advantageous  form  to 
offer  to  our  fighting  men.  Such  insurance  could  be  sold  at 
rates  within  the  power  of  all  to  pay,  and  furthermore,  it 
would  furnish  a  maximum  amount  of  protection  for  the 
premium  charged.  As  a  result,  the  Government  adopted 
this  one  form  of  insurance  during  the  war. 

Term  insurance  affords  protection  at  a  minimum  rate  for 
a  definite  period.  If  the  insured  dies  within  that  period 
the  policy  is  payable.  Should  he  outlive  the  specified  period 
the  policy  becomes  void.  It  is  similar  in  this  respect  to 
fire  insurance.  The  policy-holder  is  protected  by  paying  a 
fixed  premium  for  a  definite  number  of  months  or  years  and 
when  that  period  has  elapsed  his  property  is  unprotected. 

Term  insurance  is  popular  among  men  who  are  desir- 
ous of  securing  protection  for  a  fixed  period  and  who  want 
such  protection  at  the  lowest  possible  cost.  Many  young  pro- 
fessional men,  business  men,  men  with  large  families,  or 
men  entering  hazardous  occupations  for  a  certain  time,  are 
usually  anxious  to  secure  this  form  of  insurance.  They  are 
satisfied  that  their  dependents  are  provided  for,  should  they 
meet  with  death  within  the  next  few  years.  Generally  such 
men  intend,  within  a  few  years,  to  convert  their  term  poli- 
cies into  one  of  the  ordinary  life  policies. 

Under  ordinary  circumstances  term  insurance  is  an  un- 
wise investment.  Many  who  are  really  in  need  of  life 
insurance  take  this  term  insurance  when  they  are  young 
because  the  rates  are  low,  apparently  not  realizing  that  as 
they  grow  older  their  premium  payments  must  increase,  as 
their  mortality  risk  is  greater.  Men  engaged  in  industrial 
occupations  or  in  other  forms  of  laborious  work  forget  that 
in  their  youth  their  earning  capacity  is  greater,  and  that  as 
they  grow  older  their  wages  decrease  while  their  term  in- 
surance premiums  increase. 

Increase  in  rates  according  to  increase  in  the  age  of  the 
policyholder  is  justifiable.  Mortality  experience  has  proved 
that  on  the  average,  out  of  one  thousand  men  aged  twenty- 
nine,  living  at  the  beginning  of  any  particular  year,  eight 
will  have  died  before  the  end  of  the  year  and,  that  by  the 
time  this  group  of  men  has  reached  the  age  of  seventy, 

59 


only  thirty-one  per  cent  of  the  thousand  will  be  living.  By 
the  use  of  such  information  one  can  realize  that  the  life 
insurance  business  is  a  scientific  procedure  based  on  known 
facts.  It  guesses  at  nothing  and  is  guided  by  the  mortality 
experience  of  the  race  calculated  to  a  mathematical  nicety. 

The  Government  realized  both  the  advantages  and  the  dis- 
advantages of  term  insurance.  Therefore,  it  decided  to  fur- 
nish convertible  term  insurance.  This  afforded  the  men 
with  needed  protection  during  the  war  and  provided  for 
conversion  into  the  popular  forms  of  insurance  after  the 
war. 

This  convertible  term  insurance  was  sold  during  the  war 
at  ordinary  peace  time  rates,  as  determined  by  the  American 
Experience  Table  of  Mortality.  The  Government  rates  were 
even  cheaper  than  those  ordinarily  charged  for  like  protec- 
tion by  commercial  companies.  The  Government  insurance 
policy-holder  was  relieved  from  all  "loading  charges,"  as  the 
cost  of  operation  was  borne  by  the  state.  The  Government 
also  bore  the  additional  war  risk  which  amounted  to 
$700,000,000.  The  battle  death-rate  was  fifty-three  per  one 
thousand  men,  the  premiums  collected  amounted  approxi- 
mately to  $300,000,000  and  the  aggregate  of  the  claims  will 
reach  $1,000,000,000. 

In  order  to  substantiate  the  statement  that  the  Government 
sold  insurance  cheaper  than  a  private  company  could  or 
did  attempt  to  do,  we  have  but  to  cite  the  experience  of  the 
City  of  Toronto,  Canada.  That  city  was  desirous  of  provid- 
ing the  members  of  the  Second  Contingent  Overseas  Forces 
of  the  Canadian  Army  with  life  insurance.  Representatives 
of  the  city  called  upon  the  various  insurance  companies  in 
the  British  Empire  and  the  United  States  to  furnish  rates 
and  policies.  After  a  careful  examination  of  all  the  policies 
offered,  it  was  decided  to  accept  that  of  the  Aetna  Life  In- 
surance Company  of  Hartford,  Conn.  That  company  agreed 
to  furnish  policies  to  one  thousand  men  for  $1,000  worth 
of  insurance  at  the  rate  of  $41.27  per  annum  for  men  twenty- 
one  years  of  age.  Compare  this  with  the  rate  charged  an 
American  Soldier  for  a  similar  amount  of  protection  and  we 
find  that  the  former  was  $33.47  higher.  Furthermore,  an 
American  soldier  was  permitted  to  secure  insurance  up 
to  $10,000. 

This  Government  war  term  convertible  insurance  was 
written  in  multiples  of  $500.  The  minimum  policy  writ- 
ten was  for  $1,000  and  the  maximum  for  $10,000.  The  aver- 
age policy  was  for  $8,697.  The  maximum  was  placed  at 
$10,000  in  order  that  all  men  in  the  service  could  secure 
like  protection,  be  he  a  private,  a  captain,  or  a  general.  The 
total  amount  of  the  term  insurance  written  during  the  war 

60 


on  the  forces  of  the  United  States  amounted  to  approxi- 
mately $40,000,000,000.  The  magnitude  of  this  sum  may 
be  appreciated  when  we  consider  that  the  total  of  the  general 
life  insurance  written  by  the  nineteen  largest  companies  in 
America  during  the  year  1919  amounted  to  only  $18,867,000. 

The  Government  policy  not  only  insured  the  holder  against 
death  but  also  against  total  and  permanent  disability.  This 
was  an  exceptionally  attractive  provision  for  men  going 
into  battle  or  serving  in  any  position  in  the  Army  or  Navy 
during  the  war.  No  private  company  could  attempt  to  give 
such  protection  unless  it  charged  accordingly  or  was  sub- 
sidized by  the  Government. 

Section  400,  Article  IV,  of  the  Soldiers  and  Sailors  In- 
surance Act  provided  that  any  commissioned  officer  or  en- 
listed man  in  the  active  service  of  the  United  States  Army, 
Navy,  Marine  Corps,  Coast  Guard,  Army  or  Navy  Nurse  Corps 
was  entitled  to  the  protection  of  Government  insurance. 
However,  it  was  necessary  to  make  written  application  for 
the  same  within  one  hundred  and  twenty  days  after  the  pass- 
age of  the  Act  or  within  one  hundred  and  twenty  days  after 
enlistment.  Because  of  the  delays  which  occurred  in  the 
organizing  of  the  business  and  in  the  mobilizing  and  mov- 
ing of  thousands  of  men,  Congress  extended  the  period  of 
grace  for  those  in  the  service,  to  April  12,  1918.  The  Act 
further  provided  that  any  man  who  was  in  the  service  at 
the  time  of  the  enactment  of  this  legislation  but  who  died 
before  April  12,  1918,  or  within  one  hundred  and  twenty 
days  after  enlistment,  should  be  presumed  to  have  applied 
for  $5,000  worth  of  insurance.  This  was  known  as  automatic 
insurance.  The  same  provision  was  made  for  any  man  who 
suffered  permanent  and  total  disability  during  such  period. 
By  the  Amendment  of  December  24,  1919,  this  automatic 
insurance  was  extended,  so  as  to  include  all  men  meeting 
with  death  or  permanent  and  total  disability  after  induction 
by  a  local  draft  board  but  before  enrollment  in  the  Army. 
This  same  Amendment  declared  that  all  officers  and  men 
who  were  lost  on  the  U.  S.  Ship  "Cyclops"  which  disappeared 
on  the  fourth  of  March,  1918,  were  presumed  to  have  applied 
for  $5,000  worth  of  insurance. 

The  class  of  beneficiaries  under  automatic  insurance  was 
very  limited.  In  the  case  of  permanent  and  total  disability 
the  insured  himself  is  the  sole  beneficiary:  in  the  event  of 
death,  benefits  are  payable  to  a  widow,  a  child,  a  mother  or 
a  father  in  the  order  named. 

This  automatic  as  well  as  the  contract  term  insurance  is 
payable  in  monthly  instalments  over  a  period  of  twenty 
years.  This  instalment  feature  of  payment  has  been  the 
subject  of  much  criticism,  but  in  reality  is  one  of  the  most 

61 


providential  features  of  Government  insurance.  It  provides 
a  certain  monthly  income  for  dependents  of  those  killed  in 
the  service  and  thereby  fulfils  the  primary  aim  of  the  in- 
sured. It  is  the  soundest  form  of  financial  protection  for 
dependents.  This  policy  is  substantiated  by  statistics,  which 
show  that  sixty  per  cent  of  all  insurance  claims  paid  in 
this  country  annually  are  lost  within  six  years  by  the  bene- 
ficiaries. The  widow  or  orphans  of  the  average  wage  earner 
in  America  are  far  less  capable  of  making  a  safe  investment 
than  the  breadwinner  himself.  They  are  the  prey  for  every 
crafty  agent  who  is  nursing  a  wildcat  scheme,  or  else  they 
hoard  the  principal,  and  thereby,  lose  the  comforts  which 
they  would  have  enjoyed  had  they  received  periodical  pay- 
ments. Despite  the  criticism  leveled  against  this  clause 
in  the  war  term  policies,  it  was  the  most  judicious  means 
of  closing  doors  of  the  poorhouses  and  orphanages  to  the 
widows  and  children  of  those  men  who  died  or  were  killed 
in  the  service. 

Under  the  war  term  policies  the  beneficiaries  in  the  per- 
mitted class  were  limited  to  a  widow,  a  child,  a  grandchild, 
a  parent,  a  brother,  or  a  sister.  Owing  to  the  fact  that  many 
men  did  not  have  such  blood  relatives  and  had  made  their 
insurance  payable  to  others  than  those  specified,  it  became 
necessary  for  Congress  to  enlarge  the  permitted  class.  By  the 
Amendment  of  December  24,  1919,  this  class  has  been  en- 
larged to  include  the  following  relatives:  a  widow,  a  child, 
an  adopted  child  or  parent,  a  brother  or  sister,  a  half-brother 
or  sister,  a  brother  or  sister  by  adoption,  uncles  and  aunts, 
nephews  and  nieces,  brothers-in-law  and  sisters-in-law,  and 
any  person  who  has  stood  in  the  relationship  of  parent  to 
the  deceased  previous  to  his  enlistment. 

Should  any  designated  beneficiary  die  before  he  or  she 
has  received  the  entire  two  hundred  and  forty  instalments 
the  remaining  instalments  are  payable  to  the  person  or  per- 
sons, within  the  permitted  class,  who  would  be  entitled  to  the 
insured's  personal  property  should  he  have  died  intestate. 
If  the  permitted  class  of  beneficiaries  has  been  exhausted 
before  all  payments  of  insurance  have  been  made,  then 
the  remaining  ones  are  payable  to  the  estate  of  the  last 
beneficiary. 

It  will  be  recalled  that  every  contract  term  insurance 
policy  issued  during  the  war  provided  for  the  payment  of 
the  policy  to  the  insured  himself  in  case  of  total  and  perma- 
nent disability.  No  mention  was  made  as  to  whether  or  not 
the  man  had  to  be  discharged  from  the  service.  Compen- 
sation we  know  is  only  payable  after  the  discharge  of  the 
injured  man.  However,  insurance  is  payable  from  the  date 
that  a  man  is  declared  to  be  permanently  and  totally  dis- 

62 


abled.  The  policy  is  paid  in  monthly  instalments  of  $5.75 
per  $1,000  worth  of  insurance  carried.  Payments  for  per- 
manent and  total  disability  are  continued  during  the  life  of 
the  insured.  If  such  person  dies  before  two  hundred  and 
forty  payments  have  been  made,  the  residue  is  paid  to  his 
beneficiary. 

Before  a  policy  can  be  paid  for  permanent  and  total  dis- 
ability the  evidence  in  the  case  must  show  that  the  claimant 
has  suffered  an  impairment  of  mind  or  of  body  which  con- 
tinuously renders  him  incapable  of  engaging  in  any  gainful 
occupation.  The  diagnosis  of  such  proof  must  be  founded 
upon  conditions  which  render  it  reasonably  certain  that  the 
impairment  will  continue  throughout  the  life  of  the  claimant. 

Any  of  the  following  impairments  are  considered  ipso 
facto  permanent  and  total  disabilities :  the  irrecoverable  loss 
of  the  sight  of  both  eyes,  or  the  loss  of  both  hands,  or  both 
feet,  or  the  loss  of  one  hand  and  one  foot.  As  has  been 
pointed  out  before,  a  veteran  suffering  from  such  injuries 
is  entitled  to  compensation  at  the  rate  of  $100.00  a  month. 
Therefore,  a  man  who  carried  a  $10,000  insurance  policy 
and  became  totally  and  permanently  disabled  is  entitled  to 
$157.50  a  month  during  the  rest  of  his  life. 

The  Government  through  the  Bureau  of  War  Risk  In- 
surance has  been  very  liberal  in  paying  claims  that  have 
arisen  under  war  term  insurance  policies.  It  has  taken  the 
initiative  in  settling  all  claims.  Upon  the  receipt  of  an 
offical  report  from  the  Military  or  Naval  Authorities  of  the 
death  of  a  member  of  either  organization,  an  examination 
is  immediately  made  of  the  insurance  files  at  the  Bureau 
in  order  to  ascertain  whether  or  not  the  deceased  had  made 
application  for  insurance.  Ordinarily  if  the  deceased  man 
had  executed  an  application  for  insurance  it  would  be  on 
hand.  However,  if  there  is  no  formal  application  on  file, 
any  instrument  signed  by  the  deceased  and  delivered  to  the 
Bureau,  which  sufficiently  identifies  him,  his  beneficiary,  the 
amount  of  insurance,  and  the  age  upon  which  the  premium 
rate  was  based,  it  is  considered  to  be  a  valid  application. 
Of  course  in  order  that  such  an  application  be  valid  it  must 
have  been  executed  prior  to  April  12,  1918,  or  within  one 
hundred  and  twenty  days  after  the  enlistment  of  the  de- 
ceased. Even  a  death-bed  application  is  considered  valid 
and  the  policy  is  paid  providing  all  other  conditions  have 
been  fulfilled. 

The  evidence  required  of  a  beneficiary  is  rather  exact  but 
necessary  in  order  that  the  intention  of  the  deceased  may 
be  carried  out.  However,  the  Bureau  forwards  full  instruc- 
tions to  every  beneficiary  and  if  they  are  followed  intelli- 
gently no  unnecessary  delay  or  litigation  ensues. 

63 


A  widow  must  furnish  a  copy  of  her  marriage  certificate; 
or  if  this  is  not  to  be  found,  the  affidavit  of  the  clergyman 
who  officiated,  or  the  affidavits  of  two  eye  witnesses  of  the 
ceremony;  or  the  affidavits  of  two  persons  having  personal 
knowledge  of  the  marriage  and  who  assert  that  they  know 
that  the  deceased  and  the  claimant  lived  together  as  man 
and  wife.  A  widow  who  was  divorced  must  submit  a  certi- 
fied copy  of  the  court  order  or  decree  of  divorce.  Should  the 
widow  be  a  minor  and  the  laws  of  the  state  of  her  residence 
require  that  she  have  a  guardian,  one  must  be  appointed 
to  whom  insurance  payments  will  be  made.  In  some  states 
a  minor,  if  a  widow,  is  emancipated  from  such  minority. 
A  minor  widow  having  children  who  are  entitled  to  insur- 
ance benefits,  must  have  a  guardian. 

When  the  beneficiary  named  by  the  insured  is  a  legitimate 
child,  a  step-child,  an  adopted  child,  or  an  illegitimate  child, 
the  following  evidence  is  required:  In  a  case  of  a  legitimate 
child,  its  age  and  relationship  must  be  shown  by  a  certified 
copy  of  the  public  record  of  its  birth,  by  its  baptismal  record, 
or  by  the  affidavits  of  two  persons.  A  step-child  must  fur- 
nish proof  that  it  was  actually  domiciled  with  the  deceased 
prior  to  his  enlistment.  Proof  of  adoption  must  be  fur- 
nished in  the  form  of  a  certified  copy  of  the  court  decree  of 
adoption.  An  illegitimate  child  must  furnish  some  docu- 
ment written  by  the  deceased  wherein  he  acknowledged  such 
child  as  his  own. 

Parents  designated  as  beneficiaries  and  other  relatives 
are  required  to  establish  proof  of  their  relationship  to  the 
deceased  before  an  award  can  be  made  in  their  favor.  This 
proof  may  be  in  the  form  of  public  or  family  records  or 
affidavits  by  disinterested  persons. 

Great  care  must  be  exercised  in  paying  the  insurance  of 
a  man  who  died  without  naming  a  beneficiary.  In  such 
cases  the  Act  provided  that  the  insurance  is  payable  accord- 
ing to  the  laws  of  intestacy  existing  in  the  state  of  the  in- 
sured's  residence.  Therefore  his  legal  residence,  prior  to  his 
enlistment,  must  be  definitely  established.  The  home  ad- 
dress given  by  the  insured  on  his  application  is  not  con- 
sidered sufficient  proof  of  his  legal  residence;  furthermore, 
the  fact  that  such  address  coincides  with  the  address  of  the 
claimant  is  not  sufficient  proof.  It  is  required  that  at  least 
one  affidavit  be  secured  from  a  disinterested  person,  which 
will  sufficiently  identify  the  affiant,  and  shall  state  the  ex- 
tent of  the  affiant's  acquaintance  with  the  insured  and  his 
belief  concerning  the  legal  residence  of  the  insured  at  the 
time  of  his  enlistment. 

If  the  insured  was  a  minor  at  the  time  of  his  death  and 
did  not  designate  a  beneficiary,  the  residence  of  his  parents 

64 


must  be  determined.  Should  both  parents  be  dead,  then  the 
next  of  kin  is  required  to  furnish  proof  as  to  the  last  resi- 
dence of  the  parents.  If  absolute  proof  cannot  be  obtained, 
the  legal  residence  of  the  insured  is  determined  by  the  place 
of  his  enlistment  or  induction  into  the  service. 

Whenever  the  holder  of  term  insurance  dies  after  dis- 
charge from  the  service,  the  beneficiary  is  required  to  fur- 
nish the  certificate  of  his  death  before  the  claim  can  be 
settled.  Such  a  beneficiary  must  secure  the  affidavits  of 
two  disinterested  persons  identifying  the  deceased  and  also 
the  relationship  between  the  beneficiary  and  the  insured. 

On  August  31,  1919,  the  Bureau  of  War  Risk  Insurance 
had  adjudicated  107,643  insurance  claims  calling  for  a 
monthly  payment  of  $5,251,927.31.  A  total  of  139,002  claims 
had  been  filed  on  war  term  policies  at  the  close  of  the  fiscal 
year  June  30,  1920.  Of  this  total  131,452  claims  had  been 
allowed,  having  a  computed  value  of  $1,169,976,673.48. 
Claims  to  the  number  of  2,917  had  been  disallowed  and 
4,633  were  pending  for  the  following  reasons:  beneficiaries 
were  living  in  foreign  countries,  beneficiaries  had  failed  to 
furnish  the  required  proof,  address  of  beneficiary  was  un- 
known, communications  had  not  been  answered,  and  finally 
payments  were  being  withheld  awaiting  legal  decisions  to 
determine  the  rights  of  contending  claimants. 

From  the  standpoint  of  public  welfare,  Government  war 
term  insurance  has  amply  justified  its  creation  by  those 
who  had  the  best  interests  of  the  service  men  at  heart.  It 
has  proved  to  be  a  sound  public  policy  and  served  to  stimu- 
late self-respect  in  our  soldiers,  sailors,  and  marines.  It 
served  its  purpose  during  the  war  and  provided  protection 
at  a  small  cost  to  practically  all  service  men. 


VI 

REINSTATEMENT  AND  CONVERSION  OF  GOVERNMENT 

INSURANCE 

Now  that  the  wartime  forces  of  the  nation  have  been  de- 
mobilized, the  second  feature  of  the  Government's  insurance 
program  (the  conversion  of  war  term  insurance  into  or- 
dinary forms  of  insurance),  comes  into  consideration.  The 
war,  with  the  Selective  Service  Act,  forced  the  Government 
into  the  insurance  business,  since  Congress  realized  that  the 
nation  was  under  the  obligation  of  restoring  the  insurability 
of  those  men  called  into  the  service.  However,  all  of  these 
men  did  not  regain  their  insurability  upon  receiving  their 
discharges.  Many  of  them  had  been  sufficiently  impaired 
in  mind  or  body  to  forever  bar  them  from  securing  insur- 
ance protection  from  a  private  company.  Thus,  the  Govern- 
ment was  forced  to  continue  in  the  insurance  business  so 
that  it  might  protect  these  men,  and  in  order  to  secure  a  fair 
distribution  of  risks,  it  was  compelled  to  offer  insurance 
to  all  discharged  soldiers  and  sailors. 

Congress  made  provision  for  the  continuance  of  this  in- 
surance in  the  original  Act  of  October  6,  1917.  Article  IV, 
Section  404,  provided,  that  all  war  term  insurance  must  be 
converted  into  an  ordinary  Government  policy  within  five 
years  after  the  termination  of  the  war.  It  further  provided 
that  such  conversion  could  be  made  without  the  applicant 
being  required  to  undergo  a  medical  examination. 

The  Government  is  offering  the  six  following  forms  of  in- 
surance to  the  ex-service  men :  ordinary  life,  twenty-payment 
life,  thirty-payment  life,  twenty-year  endowment,  thirty- 
year  endowment,  and  endowment  at  sixty-two.  In  the  ex- 
perience of  the  largest  insurance  companies  in  America, 
these  six  forms  of  insurance  have  proven  to  be  the  most 
popular  and  attractive.  The  main  reason  why  these  forms 
have  proven  more  attractive  than  term  insurance  is  that  they 
provide  more  benefits  and  for  the  payment  of  premiums  in 
a  convenient  manner.  Furthermore  the  premiums  do  not 
increase  with  age. 

As  it  has  been  previously  stated,  the  only  logical  reason 
why  the  Government  issued  term  insurance  during  the  war 
was  due  to  the  fact,  that  it  was  confronted  with  the  problem 
of  providing  a  maximum  of  protection  at  a  minimum  of 
cost.  It  was  sold  to  the  men  for  a  premium  which  experience 

66 


had  proven  to  be  the  exact  net  cost  of  the  average  death 
risk  in  the  United  States  in  normal  times. 

Even  through  the  war,  or  at  least,  the  period  of  actual 
fighting  is  over,  the  Government  has  agreed  to  sell  any  one 
of  these  six  forms  of  insurance  to  the  veterans  at  net  rates. 
No  charge  of  any  kind  is  made  for  the  cost  of  conducting 
the  business.  The  rates  have  been  calculated  on  the  basis 
furnished  by  the  American  Experience  Table  of  Mortality, 
with  interest  at  3V2  per  cent.  These  rates  are  bound  to  be 
cheaper  than  any  that  can  be  offered  by  a  private  company, 
since,  it  is  estimated  by  such  companies  that  it  costs  them 
$12.00  for  every  $1,000  worth  of  insurance  they  sell.  Of 
course  they  are  forced  to  take  this  additional  cost  into 
consideration  when  making  their  premium  rates.  An  addi- 
tional point  which  they  have  to  consider  is  the  expense 
that  they  are  under  in  maintaining  an  organization  to  invest 
their  funds  advantageously. 

The  following  examples  should  convince  one  of  the 
cheapness  of  the  Government  rates.  The  annual  premium 
on  an  Ordinary  Life  policy  for  $1,000,  at  the  age  of  twenty- 
one,  is  $13.82;  on  a  Twenty-Payment  Life  for  the  same 
amount  of  protection  the  premium  is  $21.14;  on  a  Thirty- 
Payment  Life  it  is  $16.89;  on  a  Twenty- Year  Endowment 
it  is  $39.10;  on  a  Thirty-Year  Endowment  it  is  $24.33,  and 
on  an  Endowment  at  Sixty-Two  the  rate  is  $17,48  per  $1,000 
worth  of  insurance. 

Though  the  Government  pays  all  the  expenses  of  opera- 
tion, the  rates  on  converted  policies  are  generally  higher  than 
than  those  paid  by  the  average  soldier  for  his  war  term 
policy.  The  reason  is  self  evident,  the  rates  on  all  converted 
policies  are  average  ones  determined  by  the  average  length 
of  the  policy.  The  rate  on  any  converted  policy  is  fixed 
and  will  not  change  from  year  to  year  as  the  insured  grows 
older,  he  will  have  to  pay  the  same  premium  at  the  age  of 
twenty-five  as  when  he  reaches  the  age  of  seventy. 

Government  insurance  is  a  healthy  and  sound  investment 
for  a  man  in  any  walk  of  life.  For  the  rich  man,  it  is 
a  sound  stroke  of  business,  backed  by  the  resources  of  the 
United  States  Government,  and  an  excellent  means  of  pro- 
tection for  his  family  should  he  suffer  financial  reverses. 
It  is  often  more  difficult  for  the  family  of  a  man  formerly 
well  to  do  to  make  themselves  self-supporting  after  the 
death  of  the  father,  than  it  is  for  the  members  of  the  poor 
man's  family.  For  the  poor,  insurance  opens  up  an  easy  and 
safe  way  to  provide  against  the  day  of  want  and  reduced 
family  income.  It  is  a  notorious  fact  that  the  vast  majority 
of  the  families  of  American  wage  earners  are  entirely  de- 
pendent upon  the  weekly  pay  envelope.  In  such  families 

67 


if  the  breadwinner  is  taken  sick  or  meets  with  an  accident 
the  family  is  soon  reduced  to  want.  Should  such  a  man 
suffer  a  permanent  and  total  disability  his  earning  capacity 
is  destroyed  and  he  is  likely  to  become  a  public  charge. 
Many  persons  have  attempted  to  provide  for  these  contin- 
gencies by  saving,  but  it  often  happens  that  a  prolonged 
sickness  has  wiped  out  the  savings  of  many  years,  and  left 
a  feeble  old  man  to  begin  his  battle  against  poverty  in  his 
declining  years  when  his  earning  capacity  has  reached  a 
point  where  practically  all  of  his  wages  are  needed  to  satisfy 
his  current  wants.  The  Government  policies  offer  an 
opportunity  for  the  policy-holder  to  save,  and  at  the  same 
time  secure  himself  against  death  and  permanent  and  total 
disability. 

Although  insurance  was  and  is  primarily  intended  as  a 
form  of  protection  against  the  uncertainties  of  life  it  offers 
particular  opportunities  for  the  thrifty.  An  examination  of 
the  Twenty-Year  Endowment  policies  offered  by  the  Govern- 
ment will  demonstrate  the  truth  of  this  statement.  Take 
for  example,  a  policy  of  this  nature  issued  to  a  man  at  the 
age  of  twenty-five  for  $10,000,  payable  at  death  or  in  cash 
at  the  end  of  twenty  years.  The  annual  premium  on  such 
a  policy  is  $393.40  which  will  amount  to  a  total  payment 
of  $7,868  for  twenty  years.  In  return  for  this  investment 
the  policy-holder  will  receive  protection  for  twenty  years 
and  in  addition  $10,000  in  cash  at  the  end  of  that  period 
for  the  $7,868  he  paid  in  premiums. 

The  Bureau  of  War  Risk  Insurance  is  now  engaged  in 
the  task  of  converting  all  war  term  policies  into  one  of  the 
six  ordinary  policies  mentioned  above.  On  June  30,  1920, 
the  Bureau  had  converted  152,979  war  term  policies  into 
permanent  forms  of  insurance. 

The  following  table  gives  a  comparison  of  the  converted 
policies  issued: 

CONVERTED  POLICIES  ISSUED  BY  THE  BUREAU  OF 
WAR  RISK  INSURANCE 

Number  Policy  Total  Value 

17,462  Ordinary   Life  Policies $  77,986,000 

45,208  Twenty-Payment  Life    182,830,500 

4,184  Thirty-Payment   Life    __ 19,859,500 

71,011  Twenty-Year  Endowment   __ 168,276,000 

8,925  Thirty-Year  Endowment - 35,353,500 

6,189  Endowment  at  Sixty-Two - 27,516,000 

At  the  end  of  the  year  1920  the  number  of  converted 
policies  had  increased  to  237,411,  representing  an  insurance 
risk  of  $749,145,000.  This  total  was  divided  as  follows: 
$125,503,000  in  ordinary  life  policies,  $233,146,000  in  20-year 

68 


year  endowment  policies;  $270,863,000  in  20-year  life  poli- 
cies; $48,359,500  in  30-year  endowment  policies;  $41,010,000 
in  endowment  policies  payable  at  the  age  of  62,  and  $30,- 
252,000  in  30-year  payment  life  policies. 

In  addition  to  the  above  there  were  approximately 
500,000  term  insurance  policies  in  force.  Of  this  number 
300,000  represented  term  policies  held  by  ex-service  men 
and  the  remainder  by  men  in  the  active  service  on  December 
23,  1920.  When  we  consider  that  there  were  over  four  mil- 
lion term  policies  issued  during  the  war,  it  is  apparent  that 
over  three  million  ex-service  men  have  permitted  their  poli- 
cies to  lapse.  There  were  many  reasons  for  these  lapses; 
many  men  following  their  discharge  from  service  were  finan- 
cially unable  to  pay  their  premiums,  thousands  were  out  of 
employment,  many  were  discouraged  with  the  assistance 
rendered  by  the  Bureau,  but  a  lack  of  appreciation  of  the 
advantages  of  insurance  in  general  and  of  Government  in- 
surance in  particular  has  been  the  reason  why  the  majority 
of  ex-service  men  have  permitted  their  insurance  to  lapse. 

Every  opportunity  has  been  given  these  men  to  reinstate 
their  insurance.  Regulations  have  been  changed  from  time 
to  time  in  order  to  enable  all  to  take  advantage  of  the  full 
benefits  provided  by  the  Soldiers  and  Sailors  Insurance  Act. 
Prior  to  June  30,  1920,  all  policies  which  had  lapsed  for  a 
period  not  exceeding  eighteen  months  from  the  date  of  dis- 
charge, could  be  reinstated  by  the  payment  of  two  monthly 
premiums.  By  the  most  recent  regulation  this  reinstate- 
ment period  has  been  extended. 

The  regulation  of  June  30,  1920,  provided  that  any  man 
who  had  been  discharged  for  more  than  eighteen  months 
might  reinstate  his  insurance  before  January  1,  1921,  provid- 
ing he  was  in  as  good  health  as  at  the  time  of  his  discharge, 
by  the  payment  of  premiums  for  two  months.  The  payment 
of  premiums  for  two  months  was  necessary  because  one  was 
due  for  the  last  month  his  war  term  policy  was  in  force,  and 
the  second  is  for  the  first  month  the  new  policy  was  in  force. 

On  and  after  January  1,  1921,  insurance  can  be  reinstated, 
provided  the  applicant  has  not  permitted  his  policy  to  lapse 
for  more  than  eighteen  months,  by  the  payment  of  premiums 
for  two  months.  In  addition,  he  must  furnish  a  certificate 
from  a  reputable  physician,  declaring  that  the  applicant  is 
in  good  health. 

Persons  unable  to  satisfy  the  above  mentioned  conditions 
are  given  another  opportunity.  If  they  make  application 
before  July  1,  1921,  and  forward  a  report  of  their  physical 
condition  signed  by  a  reputable  physician,  with  two  months 
premiums,  policies  will  be  reinstated. 

After  July  1,  1920,  a  policy  can  be  reinstated  at  any  time 

69 


within  eighteen  months  after  it  has  lapsed,  provided  the 
applicant's  health  is  as  good  as  it  was  when  his  policy  lapsed 
and  he  is  able  to  furnish  a  full  medical  report  to  that  effect 
to  substantiate  his  statement. 

The  following  cases  will  serve  to  illustrate  the  procedure 
necessary  to  reinstate  a  war  term  policy.  Private  B.  was  dis- 
charged from  the  service  in  January,  1919.  After  leaving 
the  service  he  allowed  his  policy  to  lapse  by  failure  to  pay 
his  monthly  premiums.  In  June,  1920,  he  made  application 
for  reinstatement.  What  was  necessary  for  him  to  do?  First 
he  was  required  to  forward  two  months  premiums,  one  to 
pay  for  the  month  of  January,  1919,  the  last  month  his 
policy  was  in  force,  and  the  second  to  cover  the  month  of 
June,  1920,  when  his  policy  again  became  effective.  Secondly, 
he  was  required  to  state  that  his  health  was  as  good  then  as 
at  the  time  of  his  discharge  from  the  service. 

Suppose  that  Private  B.  did  not  make  application  for 
reinstatement  until  October,  1920 — twenty- two  months  after 
his  discharge.  He  was  obliged  to  make  the  two  premium 
payments  and  to  submit  a  signed  statement  declaring  that  he 
was  in  good  health,  for  the  consideration  of  the  Director  of 
the  Bureau  of  War  Risk  Insurance.  In  addition  he  was  re- 
quired to  furnish  a  report  of  a  coniplete  medical  examina- 
tion made  at  his  expense  by  a  reputable  physician.  If  the 
report  of  this  physician  was  favorable  his  insurance  was  re- 
instated as  of  October  1,  1920. 

By  virtue  of  the  regulations  adopted  June  30,  1920,  every 
discharged  soldier,  sailor,  or  marine  has  the  opportunity  of 
reinstating  his  Government  insurance.  Wounds,  or  disease 
contracted  in  the  service,  will  not  bar  a  man  as  long  as  his 
physical  condition  at  the  time  of  his  application  for  rein- 
statement, is  as  good  as  on  the  day  he  received  his  discharge. 

As  stated  before,  all  term  insurance  must  be  converted 
into  some  form  of  permanent  Government  insurance.  This 
conversion  must  be  made  within  five  years  after  the  publica- 
tion of  the  President's  Proclamation  of  Peace.  If  a  policy- 
holder  neglects  to  make  such  conversion  within  the  specified 
period  his  insurance  will  automatically  terminate,  and  he 
will  be  unable  to  obtain  any  form  of  Government  insurance. 

A  war  term  policy  may  be  converted  in  whole  or  in  part. 
To  effect  such  a  conversion  an  ex-service  man  must  make 
application  to  the  Bureau  for  the  particular  policy  he  wants. 
This  application  must  contain  his  full  name,  his  home  ad- 
dress, date  of  his  birth,  the  military  organization  to  which 
he  was  attached,  his  serial  number,  the  amount  of  his  war 
term  policy,  the  certificate  number  of  the  same,  and  the 
last  month  in  which  he  paid  his  premium.  All  this  in- 
formation is  necessary  in  order  that  his  term  policy  can 

70 


be  identified.  In  addition  to  the  above  information  he  should 
designate  his  beneficiary,  the  relationship,  and  address  of 
that  individual.  His  application  should  be  accompanied  by 
premiums  for  the  payment  of  the  last  month  his  war  term 
policy  was  in  effect  and  for  the  first  month  on  the  con- 
verted policy.  If  the  applicant's  term  insurance  has  lapsed 
for  more  than  six  months  he  must  submit  a  medical  report 
as  to  the  condition  of  his  health  at  the  present  time.  This 
report  is  absolutely  essential  in  order  that  the  conversion 
may  be  made. 

In  no  case  does  the  converted  policy  take  effect  until  the 
application  has  been  properly  executed  and  approved  by 
the  Bureau.  When  the  application  has  been  approved  and 
the  necessary  remittance  made  the  converted  policy  is  effec- 
tive from  the  first  of  the  following  month.  Should  his  term 
policy  have  lapsed  because  of  the  non-payment  of  premiums, 
then  the  converted  policy  will  be  effective  as  of  the  first  of 
the  month  in  which  the  application  was  received. 

Premiums  on  converted  policies  may  be  paid  monthly, 
quarterly,  semi-annually,  or  annually.  All  policy-holders 
are  entitled  to  participate  in  savings  and  gains  and  all  divi- 
dends earned.  Such  benefits  may  be  taken  in  cash,  or  used 
in  the  payment  of  premiums,  or  left  with  the  Government 
at  interest. 

A  grace  period  of  thirty  days  is  allowed  on  all  policies; 
that  is,  even  though  premiums  are  due  the  first  of  the  month 
they  may  be  paid  at  any  time  during  the  month  without  the 
policy  lapsing.  The  policy  remains  in  force  during  such 
grace  period  and  should  the  insured  die  within  that  time, 
the  policy  is  paid  minus  the  premium  due  for  the  current 
month. 

All  the  six  Government  policies  contain  the  same  liberal 
permanent  disability  clause  found  in  the  war  term  policies. 
Furthermore,  there  is  no  age  restriction  contained  in  the 
clause.  The  policy  is  payable  at  any  time  the  policy-holder 
suffers  an  impairment  of  mind  or  body  which  shall  con- 
tinuously render  him  unable  to  follow  any  substantially 
gainful  occupation,  and  it  is  reasonably  certain  that  such 
impairment  will  continue  for  life.  This  is  a  distinctive  pro- 
vision found  in  all  the  Government  policies.  The  policies 
offered  by  many  private  companies  contain  a  clause  cover- 
ing permanent  and  total  disability,  but  they  invariably  pro- 
vide that  such  disability  must  occur  before  the  insured 
reaches  the  age  of  sixty-five.  This  age  limitation  practically 
nullifies  the  clause,  since  experience  has  shown  that  the 
majority  of  total  permanent  disabilities  occur  after  the  age 
of  sixty. 

All  the  endowment  policies  are  payable  to  the  designated 

71 


beneficiary  in  the  event  of  the  death  of  the  insured.  They 
as  well  as  all  Government  policies  have  a  "cash  surrender" 
value,  it  is  that  amount  of  money  that  the  Government 
will  return  to  the  insured  after  his  policy  has  been  in  force 
for  one  year  or  more,  should  he  wish  to  surrender  it.  The 
amount  varies  according  to  the  amount  of  the  policy  and  the 
number  of  years  it  has  been  in  force.  For  instance,  if  a 
man  had  a  $5,000  ordinary  life  policy  taken  out  at  the  age 
of  twenty-five,  and  after  paying  premiums  on  it  for  four 
years  he  decides  to  surrender  it,  the  Government  will  give 
him  $128.64  in  cash.  This,  of  course,  is  in  addition  to  the 
protection  he  received  during  those  four  years. 

A  loan  may  be  secured  on  any  policy  after  it  has  been 
in  force  for  one  year  or  more.  Such  loans  cannot  exceed 
ninety-four  per  cent  of  the  cash  surrender  value  of  the 
policy.  Thus,  if  the  holder  of  the  aforementioned  $5,000 
policy  decided  to  take  the  maximum  loan  offered  on  his 
policy  at  the  end  of  four  years  he  would  receive  $120.92. 
However,  he  would  not  have  to  surrender  his  policy  as  in 
the  above  case. 

The  Extended  Insurance  privilege  found  in  Government 
policies  provides,  that  after  the  policy  has  been  in  force  for 
any  period  exceeding  one  year,  the  insured  will  be  protected 
for  a  certain  time  even  though  he  neglects  to  pay  his  prem- 
iums. The  period  of  this  Extended  Insurance  is  determined 
by  the  length  of  the  time  the  policy  has  been  in  force  and  the 
age  of  the  policy-holder  at  the  time  he  made  his  last  payment. 
For  example,  should  the  holder  of  the  $5,000  policy  men- 
tioned above  discontinue  his  payments  at  the  end  of  four 
years,  he  would  continue  to  receive  protection  for  a  certain 
period.  Extended  Insurance  closes  at  the  end  of  an  en- 
dowment period.  Therefore,  there  are  certain  years  in  which 
the  value  of  an  endowment  policy  is  more  than  is  required 
to  carry  it  to  the  end  of  the  endowment  period,  without 
further  payments.  Such  excesses,  however,  are  returned 
to  the  insured  at  the  end  of  the  period  and  is  called  "Pure 
Endowment." 

The  "Paid  Up"  feature  of  these  policies  is  another  ad- 
vantage. After  the  policy  has  been  in  force  for  one  year  or 
more,  the  insured  may  at  any  time  within  three  months 
after  his  premium  is  due,  surrender  his  policy  and  receive 
in  exchange  for  it  a  smaller  policy,  but  one  on  which  he 
will  not  have  to  pay  any  more  premiums.  For  example,  if 
the  holder  of  a  $5,000  Ordinary  Life  policy  wished  to  ex- 
change it  at  the  end  of  four  years  for  a  "Paid  Up"  policy,  he 
would  receive  one  for  $485.85  payable  at  death  to  his  bene- 
ficiary. 

Government  policies  are  exempt  from  all  restrictions  as 

72 


to  occupations  and  travel.  A  policy-holder  is  at  liberty  to 
engage  in  any  occupation  no  matter  how  hazardous  it  may 
be.  He  is  privileged  to  travel  at  any  time  and  anywhere 
that  he  may  see  fit.  These  are  more  liberal  advantages 
than  are  afforded  to  persons  carrying  insurance  in  private 
companies.  Ordinarily  such  policy-holders  are  forbidden 
from  engaging  in  certain  occupations  and  from  visiting  cer- 
tain countries  and  places. 

In  order  to  meet  the  demands  of  ex-service  men  the  per- 
mitted class  of  beneficiaries  has  been  enlarged.  This  class 
now  includes:  a  parent,  a  grandparent,  a  step-parent,  wife 
or  a  husband,  a  step-child,  and  adopted  child,  grandchild, 
a  brother  or  sister,  a  half-brother  or  half-sister,  a  brother 
or  sister  through  adoption,  step-brother  or  step-sister,  a 
parent  through  adoption,  an  uncle  or  aunt,  a  nephew  or 
niece,  a  brother-in-law  or  a  sister-in-law,  a  person  who  has 
stood  in  the  relation  of  a  parent  to  the  insured  for  a  period 
of  one  year  or  more  prior  to  his  enlistment  in  the  military 
or  naval  service  of  the  nation. 

Formerly  all  Government  policies  were  payable  in  monthly 
instalments  covering  a  period  of  twenty  years,  but  because  of 
a  demand  on  the  part  of  ex-service  men,  various  optional 
settlements  may  now  be  made.  The  first  of  these  provides 
for  the  payment  of  the  entire  policy  in  one  lump  sum. 

The  second  method  provides  for  the  payment  of  the  policy 
in  a  limited  number  of  payments.  These  monthly  instal- 
ments may  be  extended  over  a  period  from  three  to  twenty 
years.  Should  the  beneficiary  die  before  all  payments  are 
made  the  residue  is  payable  to  his  estate. 

The  third  method  offers  a  plan  whereby  cerain  monthly 
payments  are  made  to  the  beneficiary  for  life.  The  amount 
of  such  monthly  payments  are  determined  by  the  age  of  the 
beneficiary  at  the  time  of  the  death  of  the  insured.  Suppose 
that  a  man  named  his  child  as  his  beneficiary  and  the 
child  was  ten  years  of  age  at  the  time  of  the  father's  death, 
such  a  child  would  receive  $3.67  every  month  for  the  re- 
mainder of  its  life,  for  every  $1,000  worth  of  insurance  car- 
ried by  its  father. 

If  the  insured  during  his  lifetime  does  not  choose  any  of 
these  modes  of  settlement,  the  Government  will  pay  the 
policy  to  the  beneficiary  in  two  hundred  and  forty  instal- 
ments. Should  the  insured  fail  to  name  a  beneficiary  his 
converted  insurance  will  be  paid  to  his  estate  after  his 
death. 

A  beneficiary  under  any  converted  policy  may  change  a 
lump  sum  payment  into  any  of  the  instalment  methods 
described.  However,  if  the  insured  selects  a  certain  in- 
stalment method  of  settlement  then  no  change  is  permitted. 

73 


An  instalment  method  cannot  be  changed  in  favor  of  a  lump 
sum  payment. 

Equal  protection  is  afforded  to  beneficiaries  under  any 
of  the  above  described  methods  of  settlement.  No  policy 
benefits  accruing  under  or  from  a  Government  policy  can  be 
attached  by  or  assigned  to  a  creditor.  Furthermore*  no 
converted  policy  or  the  benefits  accruing  therefrom  can  ever 
be  taken  by  a  tax  collector. 

It  appears  that  the  Government  has  taken  every  precau- 
tion to  protect  and  to  provide  protection  for  its  ex-soldiers, 
sailors,  and  marines  against  the  uncertainties  of  life.  Its 
policies  offer  assurance  to  a  man  that  in  the  case  of  his 
death  his  dependents  will  be  provided  for,  that  they  will 
have  sufficient  to  enable  them  to  secure  the  necessities  of 
life,  and  that  the  same  can  never  be  taken  from  them  by 
creditors  or  tax  collectors. 

On  December  24,  1919,  Congress  authorized  the  Bureau  to 
create  a  United  States  Government  Life  Insurance  Fund, 
to  which  all  converted  insurance  premiums  are  credited. 
This  fund  amounted  to  $10,294,330.07  on  June  30,  1920.  This 
sum  is  available  for  investment  and  for  the  payment  of  con- 
verted insurance  claims.  A  large  part  of  the  fund  $10,132,- 
493.69  was  invested,  $59,000  was  held  as  a  reserve  fund, 
and  $102,836.38  was  on  hand  at  the  close  of  business  on 
June  30,  1920.  Claims  to  the  number  of  one  hundred  and 
five  had  been  allowed  on  converted  policies.  Death  claims 
numbered  one  hundred  and  four  and  called  for  payments 
amounting  to  $376,000.  There  was  one  permanent  and  total 
disability  claim  which  called  for  a  payment  of  $2,000. 

The  examination  of  the  policies  and  the  understanding 
of  the  intention  of  the  law  makers  in  sponsoring  this  legis- 
lation should  convince  our  citizens  of  the  worthiness  of  this 
insurance.  It  is  a  form  of  thrift  and  protection  which  no 
ecenomist  or  student  of  social  problems  can  discredit.  It 
is  deserving  of  the  attention  of  every  ex-service  man  and  of 
all  agencies  interested  in  the  welfare  of  the  veterans  of  the 
Great  War  and  in  their  socio-economic  problems  now  and  in 
the  future. 


74 


VII 
ORGANIZATION 

At  the  time  the  United  States  declared  war  on  the  Ger- 
man Government  in  1917  and  for  six  months  afterwards, 
no  provision  had  been  made  by  the  Federal  Government  for 
the  financial  relief  of  the  service  men  and  their  dependents. 
It  was  not  until  October  6,  1917,  that  Congress  created  the 
Division  of  Military  and  Naval  Insurance  in  the  Bureau  of 
War  Risk  Insurance. 

We  have  seen  in  the  foregoing  chapters  that  this  Act  of 
October  6,  1917,  provided  for  the  making  of  allotments  by 
enlisted  men,  for  the  paying  of  Government  allowances  to 
dependents,  for  the  compensating  of  those  who  might  sus- 
tain injuries  or  contract  disease  in  the  service,  for  the  com- 
pensating of  the  dependents  of  any  man  who  might  lose  his 
life  in  line  of  duty,  and  for  the  insuring  of  all  men  in  the 
service  who  were  willing  to  pay  an  ordinary  peace  time 
premium. 

The  tasks  thus  created  for  the  officials  of  the  Bureau  of 
War  Risk  Insurance  were  gigantic  and  at  times  almost  over- 
whelming. These  officers  were  immediately  confronted  with 
the  duty  of  insuring  every  man  in  the  service  within  one 
hundred  and  twenty  days,  of  securing  allotments  from  every 
enlisted  man  having  dependents,  and  of  the  paying  of  these 
allotments  together  with  the  Government  allowances  to  de- 
pendents in  all  parts  of  the  world.  The  law  required  the 
fulfillment  of  those  duties  immediately,  even  though  a 
trained  personnel  did  not  exist  to  perform  the  work. 

The  first  problem  attacked  by  the  Bureau  was  that  of  se- 
curing a  working  force  capable  of  explaining  the  law  to  the 
men  in  the  field.  It  will  be  remembered  that  we  had  over 
a  million  and  a  half  men  under  arms  at  that  time.  In  or- 
der to  secure  the  necessary  field  force  a  number  of  selected 
men  were  called  from  the  various  camps  and  military  posts 
of  the  country  to  Washington.  They  were  given  a  brief 
training  in  the  law,  sent  out  as  insurance  officers,  and  or- 
dered to  have  every  man  in  the  service  execute  an  allotment 
blank  whether  he  made  an  allotment  or  not;  and  further- 
more, to  secure  the  application  of  every  man  in  the  service 
who  wanted  insurance.  The  latter  was  to  be  completed  by 
February  12,  1918.  This  was  the  unpretentious  beginning 
of  an  organization  that  sold  approximately  $40,000,000,000. 

75 


worth  of  insurance  and  supervised  the  execution  of  over 
4,000,000  allotment  applications. 

As  this  work  progressed  in  the  field  and  our  army  grew, 
problems  multiplied  at  the  Bureau  in  Washington.  Quarters 
and  a  personnel  had  to  be  secured  in  an  overcrowded  city, 
in  a  city  where  every  Government  department  was  crying 
out  for  more  office  space  and  additional  help.  The  National 
Museum  was  taken  over  as  an  office  but  it  soon  proved 
too  small  to  house  the  activities  of  the  Bureau.  As  a  re- 
sult various  nondescript  buildings  and  residences  were  com- 
mandeered as  offices,  so  that  at  the  time  of  the  signing  of 
the  Armistice,  the  Bureau  was  spread  out  over  the  city  in 
fifteen  different  buildings. 

The  problem  of  securing  competent  office  help  was  even 
more  difficult.  Washington  was  overcrowded  with  persons 
who  had  come  to  engage  in  war  work,  but  their  plans  lay 
in  other  directions  than  that  of  the  Bureau  of  War  Risk 
Insurance.  The  call  of  the  War  and  Navy  Departments  ap- 
peared to  be  more  imperative  with  the  result  that  the  ma- 
jority of  these  workers  entered  the  service  of  those  depart- 
ments. Because  the  Bureau  was  unable  to  secure  outside 
help  in  sufficient  numbers,  it  employed  residents  of  the 
District  of  Columbia  who  offered  their  services.  Most  of 
those  people,  as  well  as  the  majority  of  those  secured  through 
the  United  States  Civil  Service  Commission,  were  unfamiliar 
with  the  Soldiers  and  Sailors  Insurance  Act.  Therefore, 
it  became  necessary  to  operate  schools  to  train  them  for 
positions  in  the  Bureau. 

Few  persons  realize  that  the  work  of  the  Bureau  is  highly 
technical.  The  human  element  plays  an  important  part  in 
the  administration  of  the  law  and  in  carrying  on  the  general 
business  of  the  Bureau.  Quick  perception  and  careful  at- 
tention to  details  are  necessary  on  the  part  of  employees  in 
order  that  errors  may  be  avoided. 

All  allotment  and  allowance  applications  had  to  be  care- 
fully examined  before  an  award  could  be  made,  according 
to  the  provisions  of  the  Act.  If  they  did  not  contain  the 
required  information  they  had  to  be  returned  to  the  appli- 
cants or  supplementary  applications  had  to  be  secured. 
When  an  application  was  complete  and  an  award  had  been 
made  according  to  the  number  of  dependents,  great  care 
had  to  be  exercised  in  the  directing  of  a  check  each  month 
to  the  designated  allottee. 

During  the  war  many  delays  were  caused  by  the  failure 
of  enlisted  men  to  give  sufficient  information.  The  problem 
of  incorrect  addresses  was  a  serious  one  and  caused  many  to 
suffer  while  waiting  for  their  allotment  and  allowance  checks. 

In  order  to  reduce  the  number  of  delays  and  errors  caused 

76 


by  employees  and  to  increase  the  efficiency  of  the  Bureau 
many  mechanical  devices  were  adopted.  The  extraordinary 
hazard  of  errors  that  existed  can  best  be  appreciated  by 
noting  that  in  the  files  of  the  Bureau  there  were  included 
records  of  2,138  John  Johnstons,  and  2,032  William  John- 
stons; 51,900  Smiths;  48,000  Browns;  53,200  members  of  the 
Johnston  family;  22,000  Andersons;  18,500  Walkers;  and 
28,050  members  of  the  Jones  family.  Addressograph 
machines  were  used  to  prepare  the  vast  amount  of  mail  mat- 
ter which  the  Bureau  had  to  send  out  each  day  and  for  the 
writing  of  checks  for  allotments  and  allowances,  compensa- 
tion, and  insurance.  These  checks  were  signed  at  the  rate 
of  50,000  per  day  by  one  employee  operating  a  signograph 
machine. 

During  the  war  the  Allotment  and  Allowance  Division  of 
the  Bureau  was  the  busiest  division.  On  January  1,  1918, 
awards  were  being  paid  on  234,850  applications.  On  April 
1,  1920,  the  total  number  of  applications  which  had  been 
handled  by  this  division  was  4,454,746.  Of  this  total  1,661,- 
943  applications  requested  Government  allowances.  Awards 
of  allotments  and  allowances  were  made  on  2,079,690  appli- 
cations. The  largest  disbursement  for  allotments  and  allow- 
ances was  made  in  the  month  of  November,  1918,  and 
amounted  to  $57,668,440.  With  the  termination  of  hostili- 
ties the  disbursements  of  this  division  rapidly  decreased 
and  in  February,  1920,  amounted  to  only  $3,046,317.52. 

Soon  after  the  signing  of  the  Armistice  the  work  of  the 
Compensation  and  Insurance  Divisions  began  to  increase 
steadily.  The  Compensation  Division  was  severely  embar- 
rassed in  being  unable  to  obtain  capable  employees  to  ad- 
judicate claims.  The  duty  of  settling  compensation  claims 
is  rather  a  difficult  task  and  requires  men  who  understand 
the  psychology  of  the  wounded  man  as  well  as  the  provi- 
sions of  the  Act.  Secondly,  delays  were  caused  by  the  dis- 
charged service  men  failing  to  co-operate  with  the  Bureau. 
Before  a  claim  could  be  adjusted  certain  evidence  had  to  be 
furnished  by  the  claimant.  If  he  did  not  supply  the  Bureau 
promptly  with  such  evidence,  delay  was  bound  to  ensue. 
The  facility  with  which  former  service  men  changed  their 
domiciles  was  a  cause  of  endless  trouble.  This  may  be 
appreciated  by  the  fact  that  in  June,  1920,  the  Bureau 
was  receiving  850  changed  address  notifications  every  day. 
In  addition  to  this  many  men  had  failed  to  notify  the 
Bureau  that  they  had  changed  their  residence  and  thereby 
delayed  the  settlement  of  their  cases.  It  can  readily  be  ap- 
preciated that  the  human  element  must  always  be  taken 
into  consideration  in  examining  the  progress  of  an  organiza- 
tion dealing  with  approximately  10,000,000  people. 

77 


The  work  of  the  Insurance  Division  really  began  after  the 
demobiliation  of  our  forces.  Previously  it  was  an  easy  mat- 
ter to  communicate  with  policy-holders  through  military 
channels.  Payment  of  premiums  were  made  by  the  War 
and  Navy  Departments  from  the  deductions  in  the  men's 
pay.  After  the  men  had  been  discharged  it  was  necessary 
for  the  Bureau  to  communicate  with  the  man  directly  and 
advise  him  about  his  premiums  and  the  benefits  of  the 
permanent  insurance  policies.  During  the  year  1920  over 
5,000,000  premium  notices  were  mailed. 

A  great  volume  of  correspondence  had  to  be  carried  on 
by  the  Bureau.  At  the  close  of  the  fiscal  year  June  30,  1920, 
the  Bureau  had  received  40,000,000  letters  and  had  sent  out 
60,000,000  pieces  of  mail.  This  task  was  only  accomplished 
by  the  use  of  dictating  and  transcribing  machines. 
These  in  addition  to  typewriters  and  automatic  typewriters 
assisted  in  the  expediting  of  this  work.  The  flood  of  insur- 
ance applications,  inquiries,  remittances,  and  other  corres- 
pondence, which  required  the  use  of  the  same  address  time 
after  time,  were  rapidly  cared  for  by  the  use  of  addresso- 
graph  machines.  The  speed  acquired  with  the  aid  of  such 
mechanical  devices  tended  to  eliminate  many  difficulties  in 
the  handling  of  the  business  of  the  Bureau.  These  devices 
included:  mail  cutting  machines,  envelope  sealers  capable 
of  sealing  126,000  letters  a  day,  folding  machines,  and  tying 
machines.  All  proved  necessary  in  order  to  carry  on  the 
great  correspondence  of  the  organization.  It  was  a  mark 
of  the  attempt  that  the  Bureau  made  to  reduce  the  hazard 
of  error  to  a  minimum. 

Even  with  such  an  organization  this  great  relief  work 
could  not  have  been  carried  on  as  effectively  as  it  has  been 
except  for  the  assistance  rendered  by  various  welfare  organi- 
zations. In  the  early  days  of  1918  it  was  necessary  for  the 
handful  of  insurance  officers,  who  had  been  sent  to  France, 
to  accept  the  aid  of  the  Y.  M.  C.  A.  This  organization 
turned  over  their  huts  for  use  as  offices  and  assigned  secre- 
taries to  aid  in  the  clerical  work  necessary  in  order  that  every 
man  in  the  American  Expeditionary  Forces  might  have  the 
opportunity  of  making  an  allotment  and  applying  for  in- 
surance. 

In  this  country  the  greatest  assistance  was  rendered  by 
the  Home  Service  Section  of  the  American  Red  Cross.  The 
personnel  in  every  chapter  of  this  great  relief  organization 
rendered  intelligent  assistance  to  the  dependents  of  men 
in  the  service.  They  aided  timid  relatives  in  corresponding 
with  the  Bureau.  In  many  needy  cases  they  advanced  money 
to  destitute  dependents  while  they  were  awaiting  the  ar- 
rival of  their  allotment  and  allowance  checks. 

78 


With  the  return  of  our  men  from  Europe  the  work  of  all 
wartime  welfare  organizations  was  increased.  Their  aid 
was  solicited  in  the  securing  of  delayed  allotments,  their 
advice  was  sought  by  veterans  in  need  of  compensation  and 
medical  treatment.  An  idea  of  the  number  of  persons  who 
donated  their  service  may  be  realized  from  the  fact  that 
the  Red  Cross  assigned  15,000  persons,  the  Knights  of  Colum- 
bus 5,000,  and  the  Young  Men's  Christian  Association  5,000 
to  this  work.  The  entire  number  of  persons  engaged  in 
this  work  cannot  be  estimated  but  it  is  safe  to  say  that  they 
numbered  over  150,000.  For  in  addition  to  the  organiza- 
tions named  above  the  following  rendered  valuable  assist- 
ance: The  War  Camp  Community  Service,  the  National 
Catholic  Welfare  Council,  the  Post  Office  Department,  the 
Salvation  Army,  the  Jewish  Welfare  Board,  the  Y.  W.  C.  A., 
the  National  Tuberculosis  Association,  Grange  Organizations, 
and  the  American  Legion. 

Even  with  such  assistance  the  work  of  the  Bureau  of  War 
Risk  Insurance  has  not  operated  easily  and  effectively. 
Most  distressing  delays  have  occurred  in  the  adjusting  of 
insurance  and  compensation  claims.  In  the  month  of 
March,  1920,  there  were  84,000  compensation  claims  pend- 
ing and  5,400  insurance  claims  unsettled. 

Examination  has  disclosed  the  following  causes  for  the 
delays  in  the  adjudication  and  payment  of  these  compensa- 
tion and  insurance  claims.  First,  many  of  the  compensation 
claims  were  old  ones  that  had  been  reopened.  This  was  due 
to  the  fact  that  it  had  been  recently  decided  that  a  claimant 
for  compensation  might  be  dependent  even  though  he  was 
in  receipt  of  insurance  benefits.  For  the  sake  of  clearness 
we  might  reiterate  that  insurance  is  payable  in  case  of  per- 
manent and  total  disability  or  death  irrespective  of  the  bene- 
ficiary's  financial  condition.  On  the  contrary,  compensation 
is  only  payable  for  a  disability  that  is  rated  at  ten  per  cent 
or  greater,  or  in  the  case  of  death,  benefits  are  payable  to  cer- 
tain dependents  as  specified  in  the  Act.  Secondly,  thousands 
of  claimants  were  residents  of  European  countries  who  were 
cut  off  from  mail  communication  with  the  United  States. 
Thirdly,  claimants  had  changed  their  residences  without 
notifying  the  Bureau  of  their  new  addresses.  Of  the  52,000 
disability  claims  pending,  ex-service  men  were  the  claimants. 
Sixteen  per  cent  of  these  cases  were  delayed  because  suf- 
ficient proof  had  not  been  received  to  identify  the  claimant 
with  the  service.  Such  identification  was  absolutely  neces- 
sary, as  the  law  provides  that  in  order  to  receive  compensa- 
tion the  claimant  must  have  been  in  the  service.  The  Bureau 
had  to  rely  upon  the  War  and  Navy  Departments  for  this 
information  and  also  for  a  report  of  the  claimant's  physical 

79 


condition  at  the  time  of  his  discharge.  It  generally  took 
from  four  to  six  weeks  to  receive  a  reply  from  these  depart- 
ments, therefore  delay  resulted  in  the  adjudication  of  a  com- 
pensation claim.  A  large  number  of  these  disability  claims 
were  delayed  because  the  claimants  failed  to  follow  them  up, 
that  is,  they  did  not  answer  the  communications  addressed 
to  them  by  the  Bureau  or  else  did  not  comply  with  its 
requests. 

About  forty  per  cent  of  these  52,000  claims  were  held  in 
file  awaiting  the  correct  addresses  of  the  claimants.  Lack 
of  sufficient  information  from  medical  authorities  was  hold- 
ing up  about  forty-one  per  cent  of  these  cases.  Such  infor- 
mation was  necessary  in  order  to  determine  the  extent  of 
the  claimant's  physicaj  disability.  Approximately  20,000 
men  were  awaiting  medical  examinations  by  the  physicians 
of  the  United  States  Public  Health  Service.  Since  these 
physicians  were  not  in  the  direct  employment  of  the  Bureau 
of  War  Risk  Insurance  the  Director  had  little  authority 
over  them. 

The  foregoing  is  a  brief  description  of  the  organization,  of 
the  difficulties,  and  of  the  success  of  the  machinery  provided 
by  Congress  for  the  administration  of  the  Soldiers'  and 
Sailors'  Insurance  Act.  Before  drawing  a  conclusion  we 
should  bear  in  mind  the  problem  that  this  Bureau  had  to 
handle,  the  severe  lack  of  facilities  in  Washington,  and  the 
untrained  personnel  with  which  it  attempted  to  carry  out 
the  provisions  of  the  Act  through  a  central  office  in  Wash- 
ington. 


80 


CONCLUSION 

The  errors  of  the  Bureau  of  War  Risk  Insurance,  and  not 
its  achievements,  attract  the  attention  of  the  public.  Bene- 
ficiaries of  the  Bureau  accept  benefits  as  a  matter  of  course, 
but  those  not  receiving  prompt  assistance  condemn  the 
Bureau  thoughtlessly  disregarding  its  many  problems. 

In  frequent  conferences,  the  officials  of  the  Bureau  im- 
pressed upon  the  writer  the  fact  that  the  Bureau  was  cre- 
ated primarily  for  the  benefit  of  those  men  and  women  who 
had  been  in  the  military  and  naval  service  of  the  nation. 
Therefore,  they  declared  that  it  was  their  sole  aim  to  ad- 
minister the  Soldiers  and  Sailors  Insurance  Act  in  such  a 
manner  as  would  render  the  most  efficient  and  effective  re- 
lief to  the  veterans  of  the  World  War  and  their  dependents. 
These  officials  admitted  that  errors  had  occurred,  but  that 
they  were  attempting  to  eliminate  them  by  obtaining  expert 
advice  and  were  encouraging  constructive  criticism  from 
all  persons  and  organizations  interested  in  the  problem. 

In  the  foregoing  pages  the  writer  explained  the  various 
provisions  in  the  Soldiers  and  Sailors  Insurance  Act  and 
described  the  manner  in  which  the  Act  has  operated.  From 
his  investigation  he  has  drawn  conclusions  on  the  follow- 
ing points:  In  the  first  place,  were  the  provisions  of  the 
Act  adequate  or  not?  Secondly,  has  the  purpose  of  the 
Act  been  accomplished?  Thirdly,  has  Government  insurance 
been  a  success?  Fourthly,  is  the  present  organization  cap- 
able of  administering  the  provisions  of  the  Act? 

He  is  of  the  opinion  that  this  Act  did  provide  the  most 
liberal  benefits  granted  by  any  Government  engaged  in  the 
World  War.  The  allowances  granted  to  dependents  during 
the  war  were  generally  sufficient  to  provide  for  the  needs 
of  the  average  wage  earner's  family.  Of  course  they  should 
have  been  more  liberal  in  cities  where  the  cost  of  living 
was  very  high.  The  compensation  benefits  granted,  when 
made  commensurate  to  the  economic  loss  sustained,  were 
adequate.  The  insurance  protection  granted  was  the  most 
liberal  enjoyed  by  the  personnel  of  any  army.  The  rates 
were  low  enough  to  permit  every  man  in  the  service  to  take 
out  a  policy  if  he  desired  to  do  so. 

Though  the  provisions  of  the  Act  have  been  made  generous 
and  sufficient  by  amendments  the  actual  relief  rendered  has 

81 


not  been  sufficient  or  satisfactory.  Therefore  the  aim  and 
the  purpose  of  the  Act  have  not  been  fully  accomplished. 
This  has  been  due  to  legislative  and  administrative  defici- 
encies. These  evils  can  only  be  corrected  by  Congress. 

The  Bureau  of  War  Risk  Insurance  must  be  given  both 
the  authority  and  the  means  to  provide  adequate  medical 
care  and  hospitalization  for  the  ever  increasing  army  of  dis- 
abled and  diseased  veterans.  Under  the  existing  law  the 
Director  of  the  Bureau  of  War  Risk  Insurance  must  rely 
upon  the  United  States  Public  Health  Service  for  hospital 
facilities,  and  for  the  medical  treatment  of  the  beneficiaries  of 
the  Soldiers  and  Sailors  Insurance  Act.  Furthermore,  the 
Director  is  compelled  to  rely  upon  the  physicians  of  the 
United  States  Public  Health  Service  to  physically  examine 
all  claimants  for  compensation. 

It  is  evident  that  legislation  should  be  enacted  providing 
for  the  transfer  of  all  personnel  and  hospital  facilities  under 
the  jurisdiction  of  the  United  States  Public  Health  Service, 
which  are  not  actually  needed  for  the  care  of  the  civilian 
population,  to  the  jurisdiction  of  the  Director  of  the  Bureau 
of  War  Risk  Insurance.  Furthermore,  the  Director  of  the 
Bureau  of  War  Risk  Insurance  should  be  authorized  to 
maintain  an  adequate  number  of  medical  examiners  in  con- 
venient centers  throughout  the  country.  Under  our  former 
pension  system  certain  physicians  in  different  sections  of 
the  country  were  designated  to  examine  pension  claimants. 

Medical  treatment  and  hospitalization  of  disabled  veterans 
is  the  greatest  problem  that  the  Bureau  has  to  meet  at  the 
present  time.  At  the  close  of  the  year  1920  it  was  estimated 
by  the  American  Legion  Hospitalization  Committee  that 
there  were  20,698  veterans  in  Government  and  contract  hos- 
pitals, and  that  hospital  cases  were  increasing  at  the  rate  of 
1,500  a  month  in  excess  of  the  number  of  patients  dis- 
charged. Information  furnished  by  the  Bureau  of  War  Risk 
Insurance  on  January  27,  1921,  placed  the  number  in  hos- 
pitals at  23,323.  Dr.  Haven  Emerson,  chief  of  the  medical 
division  of  the  Bureau,  testified  before  the  Dawes  Commit- 
tee that  35,000  men  would  be  in  need  of  hospitalization  be- 
tween the  years  1925  and  1927. 

The  patients  of  the  Bureau  may  be  divided  into  three 
classes:  1st,  those  suffering  from  tuberculosis;  2nd,  those 
afflicted  with  mental  diseases;  and  3rd,  general  medicine 
and  surgical  patients.  In  September,  1920,  there  were  4,800 
tuberculosis  patients  in  hospitals.  In  January,  1921,  the 
Bureau  declared  that  this  number  had  increased  to  9,543 
patients.  Dr.  H.  A.  Patterson,  a  member  of  the  National 
Tuberculosis  Association,  estimated  that  48,000  men  had 
been  discharged  from  the  service  who  would  eventually 

82 


break  down  with  tuberculosis.  In  referring  to  ex-service 
men  suffering  from  mental  diseases,  Dr.  T.  W.  Salmon,  an 
eminent  psychiatrist,  declared,  "No  blacker  reproach  to  the 
honor  and  humanity  of  the  country  exists  today  than  the 
practical  abandonment  by  the  richest  country  on  earth  of 
more  than  one-half  of  its  ex-service  men  who  are  inflicted 
with  insanity."  In  testifying  before  the  Committee  of  Inter- 
state and  Foreign  Commerce  of  the  House  of  Representatives 
on  January  7,  1921,  Dr.  Salmon  stated,  "That  of  the  5,340  in- 
sane ex-service  men  who  are  under  treatment,  only  a  third 
are  in  hospitals  owned  by  the  Government.  One  of  these 
is  a  converted  reform  school  in  Roxbury,  Mass.  Another  is 
an  inebriate  asylum  in  Iowa,  which  has  been  turned  over  tc 
the  Government.  Another  is  a  naval  hospital  in  Philadelphia 
which  was  built  just  after  the  Civil  War,  and  another  is 
a  hotel  at  Augusta,  Georgia,  which  used  to  be  a  girls'  school 
Yet  those  are  regarded  as  special  hospitals  for  the  treatmenl 
of  this  special  form  of  disease."  Furthermore,  he  stated 
that  patients  suffering  from  mental  diseases  constituted  2i 
per  cent  of  the  Government's  hospital  cases,  and  that  the  tota 
would  be  nearer  50  per  cent  than  30  per  cent  if  all  suet 
sufferers  had  applied  to  the  Government  for  treatment. 

The  lack  of  sufficient  and  proper  hospital  facilities  to  care 
for  the  tubercular  and  mentally  diseased  veterans  has  beer 
the  serious  defect  in  the  hospitalization  of  the  claimants  o 
the  Bureau  of  War  Risk  Insurance.  The  responsibility  fo] 
this  lack  of  proper  hospital  facilities  rests  upon  Congress 
An  attempt  to  correct  this  evil  was  made  by  the  Sixty-Sixtl 
Congress  when  it  appropriated  $18,600,000  on  March  4,  1921 
for  the  construction  of  new  hospitals.  However,  additiona 
appropriations  must  be  made  immediately  in  order  tha 
especially  equipped  hospitals  may  be  erected  for  the  in 
creasing  numbers  of  tubercular  and  mentally  diseased  ex 
service  men.  Without  such  additional  facilities  the  medica 
provisions  of  the  Soldiers  and  Sailors  Insurance  Act  canno 
be  fulfilled.  The  general  medicine  and  surgical  cases  ma: 
be  cared  for  by  temporary  measures,  such  as  the  transferrinj 
of  existing  Government  hospitals  and  institutions  to  th< 
Bureau  of  War  Risk  Insurance. 

As  a  war  time  measure  Government  insurance  was  mos 
successful,  for  ninety  per  cent  of  the  men  and  women  ii 
the  service  applied  for  insurance.  But  as  a  peace  time  ven 
ture,  Government  insurance  has  not  been  so  successful 
Over  three  million  term  insurance  policies  issued  during  th 
war  have  not  been  converted,  and  have  been  permitted  i 
lapse  by  the  policy-holders.  Although  the  Government' 
permanent  policies  contain  many  liberal  features,  the  Bureai 
has  had  a  tremendous  difficulty  in  convincing  the  ex-servic 

83 


men  of  their  merits.  An  explanation  of  the  reason  why  the 
majority  of  the  policy-holders  have  permitted  their  policies 
to  lapse  has  been  given  in  the  earlier  pages  of  this  mono- 
graph. However,  we  may  conclude  that  the  dissatisfaction 
which  these  men  found  with  the  administration  of  the  busi- 
ness of  the  Bureau  was  a  very  important  factor  for  this 
general  lapsation  of  Government  policies.  Probably  the 
chief  cause  can  be  found  in  the  incorrigible  disposition  of 
the  human  race  to  delay  the  purchase  of  life  insurance  to 
a  later  date. 

From  the  investigation  carried  on  by  the  writer,  he  is 
of  the  opinion  that  the  present  organization  of  the  Bureau 
is  not  capable  of  adequately  administering  the  provisions 
of  the  Act.  It  cannot  be  expected  that  such  a  tremendous 
piece  of  social  relief  can  be  carried  out  by  means  of  corres- 
pondence through  one  central  office  of  a  super-centralized 
organization.  Under  the  present  system  before  any  policy 
for  insurance  can  be  converted,  before  any  claim  for  insur- 
ance or  compensation  can  be  paid,  the  officials  of  the  Bureau 
in  Washington  must  review  the  case  and  pass  judgment.  As 
mentioned  before,  this  work  is  carried  on  through  corre- 
spondence and,  therefore,  has  resulted  in  a  volume  of  daily 
mail  so  great  that  it  has  been  impossible  to  give  a  personal 
answer  to  every  request  for  information  and  guidance. 
Form  letters,  form  paragraphs,  and  other  unsatisfactory 
methods  have  been  resorted  to  as  a  matter  of  necessity.  It 
is  apparent  that  under  such  a  system  that  a  large  amount 
of  this  mail  has  been  answered  improperly  or  insufficiently, 
and  delays  caused  thereby  have  often  resulted  in  the  dis- 
couragement of  many  ex-soldiers,  widowed  mothers,  or  or- 
phan children. 

Congress  must  bear  most  of  the  responsibility  for  this 
condition  of  affairs,  for  it  failed  to  provide  for  an  adequate 
organization  to  carry  on  this  needed  relief.  Furthermore, 
its  appropriations  have  not  been  sufficient  to  provide  for  an 
adequate  force  of  competent  employees.  It  enacted  a  judi- 
cious relief  law  but  it  did  not  provide  sufficient  money  to 
carry  on  the  work  or  to  secure  the  grade  of  help  necessary. 
The  very  nature  of  the  business  of  the  Bureau,  dealing  as  it 
does  with  people  in  all  sections  of  the  country,  of  all  grades 
of  intelligence,  with  needs  that  vary  with  the  individual,  is 
of  such  a  personal  character  that  the  problem  cannot  be 
handled  satisfactorily  without  a  district  form  of  organiza- 
tion. Even  the  smallest  insurance  companies  have  some 
form  of  district  organization  to  care  for  their  policy-holders 
and  claimants.  Because  of  such  organization  they  are  able 
to  give  prompt  and  efficient  service  when  it  is  needed.  They 
are  in  a  position  to  fulfil  their  obligations  towards  the  be- 

84 


reaved  family,  and  by  prompt  action  prevent  embarrassment 
and  often  privation. 

District  offices  for  the  War  Risk  Insurance  Bureau  would 
tend  to  reduce  greatly  the  menace  of  lost  and  incorrect  ad- 
dresses of  its  claimants.  Many  who  can  not  now  be  reached 
by  mail  could  be  traced  by  personal  inquiries.  The  estab- 
lishment of  such  offices  in  convenient  centers  would  enable 
claimants  of  the  Bureau  to  file  their  claims  personally.  The 
officials  in  these  offices  would  be  able  to  grant  assistance 
and  dispose  of  cases  without  delay. 

After  a  careful  examination  of  the  problem  of  the  dis- 
abled service  men  the  writer  is  of  the  opinion  that  of  all 
who  were  injured  or  diseased  in  the  World  War,  by  far  the 
majority  may  be  restored  to  their  normal  economic  capac- 
ity, provided  they  receive  proper  medical  treatment,  finan- 
cial assistance,  and  vocational  training.  A  small  number 
have  been  permanently  and  totally  disabled,  the  exact  num- 
ber on  June  30,  1920,  being  3,204.  They  will  of  necessity 
remain  dependent  upon  the  nation.  For  them  the  Govern- 
ment's responsibility  consists  of  providing  financial  support. 
Beyond  that  they  should  be  insured  the  kind  of  care  that 
is  best  adapted  to  their  individual  needs.  The  second  class 
of  victims,  those  suffering  from  partial,  though  permanent 
disabilities,  are  also  entitled  to  permanent  assistance  from 
the  Government.  As  their  loss  has  only  been  partial  they 
should,  after  proper  training,  be  able  to  resume  a  place  in 
the  normal  life  of  the  community  and  be  productive  members 
of  society.  There  is  a  third  class  made  up  of  those  men 
who  are  suffering  from  temporary  disabilities.  These  men 
with  proper  medical  treatment  and  necessary  vocational 
guidance  should  be  able  to  resume  their  positions  as  inde- 
pendent citizens  of  the  country. 

In  order  that  this  vast  army  of  men  suffering  with  perma- 
nent and  temporary  disabilities  may  be  restored  to  society, 
the  Government  must  provide.  1st,  medical  care  and  hospi- 
tal treatment;  2nd,  financial  assistance  during  their  period 
of  incapacity;  and  3rd,  vocational  education  and  guid- 
ance. Laws  have  been  passed  providing  for  these  needs  but 
the  administration  of  those  laws  have  been  placed  in  three 
separate  Government  agencies.  The  United  States  Public 
Health  Service  has  been  requested  to  furnish  them  with 
medical  care  and  hospital  treatment;  the  Bureau  of  War 
Risk  Insurance  has  been  charged  with  the  duty  of  providing 
them  with  financial  aid;  and  the  Federal  Board  for  Voca- 
tional Education  has  been  ordered  to  train  them  for  new 
occupations  in  life. 

This  present  system  has  proved  unsuccessful.  An  individ- 
ual in  need  of  assistance  is  required  to  make  application  for 

85 


such  treatment  and  assistance  to  all  three  agencies.  In 
two  of  these  agencies  he  is  required  to  furnish  the  same 
identical  proof  to  support  his  claim  before  any  assistance 
can  be  rendered  to  him.  In  passing  from  the  jurisdiction 
of  one  agency  to  another,  men  have  been  left  without  means 
to  support  themselves  and  their  families.  Therefore,  many 
men  have  been  reluctant  to  give  up  their  compensation  pay- 
ments and  transfer  to  the  jurisdiction  and  payrolls  of  the 
Federal  Board  for  Vocational  Education. 

The  only  solution  to  this  three-fold  problem  is  to  con- 
solidate these  three  relief  agencies  into  one  under  a  single 
head.  And  in  order  to  furnish  promptly  relief  and  carry 
out  the  provisions  made  by  Congress  for  disabled  ex-service 
men,  the  director  of  this  one  agency  should  have  authority 
to  establish  district  offices  of  the  Bureau  throughout  the 
country.  The  officers  placed  in  charge  of  these  district  offices 
should  be  given  full  power  and  authority  to  grant  immediate 
treatment  and  financial  assistance  to  all  needy  ex-service 
men.  After  claimants  have  been  physically  rehabilitated, 
these  district  offices  should  have  authority  to  place  them  in 
vocational  training. 

The  success  of  the  consolidation  of  these  relief  agencies 
and  the  decentralization  of  the  newly  created  bureau  can 
be  measured  by  the  immediate  physical  and  financial  relief 
rendered,  and,  at  a  later  date,  by  the  number  of  disabled 
veterans  who  have  overcome  their  individual  handicaps  and 
are  found  in  independent  positions  in  the  normal  wa*.ks  of 
life. 


86 


BIOGRAPHY 

James  A.  Losty  was  born  in  New  York  City,  September  1, 
1894.  He  received  his  elementary  education  in  the  Public 
Schools  of  Hartford,  Conn.  He  pursued  his  collegiate  studies 
at  St.  Bonaventure's  College  and  at  the  Catholic  University 
of  America.  In  June,  1917,  he  was  graduated  from  the  Cath- 
olic University.  The  following  September  he  began  his 
graduate  studies  in  the  same  institution  and  in  June,  1918, 
received  the  degree  of  Master  of  Arts.  During  the  following 
year  he  was  employed  as  a  "Special  Expert"  in  the  Bureau 
of  War  Risk  Insurance.  In  October,  1919,  he  resumed  his 
studies  under  Dr.  John  O'Grady,  Dr.  Frank  O'Hara,  Dr.  John 
Ryan,  Dr.  Edward  A.  Pace,  and  Dr.  William  Kerby  at  the 
Catholic  University. 


BIBLIOGRAPHY 

Annual  Report  of  the  Director  of  the  Bureau  of  War  Risk  Insur- 
ance for  the  year  1919  and  1920. 

Annual  Reports  1920— United  States  Public  Health  Service. 

Bulletins  of  the  Bureau  of  War  Risk  Insurance. 

Care  of  the  Dependents  of  Enlisted  Men  in  Canada,  by  S. 
Herbert  Wolfe. 

Disabled  Soldiers  and  Sailors,  by  Edward  T.  Devine. 

Federal  Military  Pensions  in  the  United  States,  by  William  H. 
Glasson,  PhD. 

Congressional  Record  of  the  Sixty-Fifth  Congress. 

Congressional  Record  of  the  Sixty-Sixth  Congress. 

Reports  of  the  Commissioner  of  Pensions  for  the  years  1861, 
1871,  1878,  1885,  1900,  and  1916. 


87 


APPENDIX 
THE  WAR   RISK  INSURANCE  ACT 

(WITH    AMENDMENTS   PRIOR   TO   JULY    1,   1918) 

THIS    PUBLICATION     CONTAINS    ONLY    THE    PROVISIONS    RELATING    TO    THE    DIVISION    OP 
MILITARY    AND     NAVAL     INSURANCE 


AN  ACT  To  authorize  the  establishment  of  a  Bureau  of  War  Risk  Insurance 
in  the  Treasury  Department 


Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled. 

ARTICLE  I. 

SECTION  1.  That  there  is  established  in  the  Treasury  Depart- 
ment a  Bureau  to  be  known  as  the  Bureau  of  Wark  Risk  Insur- 
ance, the  directors  of  which  shall  receive  a  salary  at  the  rate 
of  $5,000  per  annum. 

That  there  be  in  such  bureau  a  Division  of  Marine  and 
Seamen's  Insurance  and  a  Division  of  Military  and  Naval  Insur- 
ance in  charge  of  a  commissioner  of  Marine  and  Seamen's  In- 
surance and  a  commissioner  of  Military  and  Naval  Insurance, 
respectively,  each  of  whom  shall  receive  a  salary  of  $4,000  per 

annum. 

•  •***** 

SEC.  13.  That  the  director,  subject  to  the  general  direction  of 
the  Secretary  of  the  Treasury,  shall  administer,  execute,  and  en- 
force the  provisions  of  this  Act,  and  for  that  purpose  have  full 
power  and  authority  to  make  rules  and  regulations  not  inconsis- 
tent with  the  provisions  of  this  Act,  necessary  or  appropriate 
to  carry  out  its  purposes,  and  shall  decide  all  questions  arising 
under  the  Act,  except  as  otherwise  provided  in  section  five. 
Wherever  under  any  provision  or  provisions  of  the  Act  regula- 
tions are  directed  or  authorized  to  be  made,  such  regulations, 
unless  the  contex  otherwise  requires,  shall  or  may  be  made  by 
the  director,  subject  to  the  general  direction  of  the  Secretary 
of  the  Treasury.  The  director  shall  adopt  reasonable  and  proper 
rules  to  govern  the  procedure  of  the  divisions  and  to  regulate 
and  provide  for  the  nature  and  extent  of  the  proofs  and  evidence 
and  the  method  of  taking  and  furnishing  the  same  in  order  to 
establish  the  right  to  benefits  of  allowance,  allotment,  compensa- 
tion, or  insurance  provided  for  in  this  Act,  the  forms  of  appli- 
cation of  those  claiming  to  be  entitled  to  such  benefits,  the 
methods  of  making  investigations  and  medical  examinations,  and 
the  manner  and  form  of  adjudications  and  awards:  Provided, 

88 


however,  That  payment  to  any  attorney  or  agent  for  such  assist- 
ance as  may  be  required  in  the  preparation  and  execution  of  the 
necessary  papers  shall  not  exceed  $3  in  any  one  case:  And  pro- 
vided further,  That  no  claim  agent  or  attorney  shall  be  recognized 
in  the  presentation  or  adjudication  of  claims  under  articles  two, 
three,  and  four,  except  in  the  event  of  disagreement  as  to  a 
claim  under  the  contract  of  insurance  between  the  bureau  and 
any  beneficiary  or  beneficiaries  thereunder  an  action  on  the 
claim  may  be  brought  against  the  United  States  in  the  district 
court  of  the  United  States  in  and  for  the  district  in  which 
such  beneficiaries  or  any  one  of  them  resides,  and  that 
whenever  judgment  shall  be  rendered  in  an  action  brought  pur- 
suant to  this  provision  the  court,  as  part  of  its  judgment,  shall 
determine  and  allow  such  reasonable  attorney's  fees,  not  to  ex- 
ceed five  per  centum  of  the  amount  recovered,  to  be  paid  by 
the  claimant  in  behalf  of  whom  such  proceedings  were  insti- 
tuted to  his  attorney,  said  fee  to  be  paid  out  of  the  payments  to 
be  made  to  the  beneficiary  under  the  judgment  rendered  at  a 
rate  not  exceeding  one-tenth  of  each  of  such  payments  until  paid. 

Any  person  who  shall,  directly  or  indirectly,  solicit,  contract 
for,  charge,  or  receive,  or  who  shall  attempt  to  solicit,  contract 
for,  charge,  or  receive  any  fee  or  compensation,  except  as  herein 
provided,  shall  be  guilty  of  a  misdemeanor,  and  for  each  and 
every  offense  shall  be  punishable  by  a  fine  of  not  more  than  $500 
or  by  imprisonment  at  hard  labor  for  not  more  than  two  years, 
or  by  both  such  fine  and  imprisonment. 

SEC.  14.  That  the  bureau  and  its  divisions  shall  have  such 
deputies,  assistants,  actuaries,  clerks,  and  other  employees  as  may 
be  from  time  to  time  provided  by  Congress.  The  bureau  shall, 
by  arrangement  with  the  Secrtary  of  War  and  the  Secretary 
of  the  Navy,  respectively,  make  use  of  the  services  of  surgeons 
in  the  Army  and  Navy.  The  Secretary  of  the  Treasury  is  author- 
ized to  establish  an  advisory  board  consisting  of  three  members 
skilled  in  the  practice  of  insurance  against  death  or  disability 
for  the  purpose  of  assisting  the  Division  of  Military  and  Naval 
Insurance  in  fixing  premium  rates  and  in  the  adjustment  of 
claims  for  losses  under  the  contracts  of  insurance  provided  for 
in  article  four  and  in  adjusting  claims  for  compensation  under 
article  three;  compensation  for  the  persons  so  appointed  to  be 
determined  by  the  Secretary  of  the  Treasury,  but  not  to  exceed 
$20  a  day  each  while  actually  employed. 

SEC.  15.  That  for  the  purposes  of  this  Act,  the  director,  com- 
missioners, and  deputy  commissioners  shall  have  power  to  issue 
subpoenas  for  and  compel  the  attendance  of  witnesses  within  a 
radius  of  one  hundred  miles,  to  require  the  production  of  books, 
papers,  documents,  and  other  evidence,  to  administer  oaths  and 
to  examine  witnesses  upon  any  matter  within  jurisdiction  of  the 
bureau.  The  director  may  obtain  such  information  and  such 
reports  from  officials  and  employees  of  the  departments  of  the 
Government  of  the  United  States  and  of  the  States  as  may  be 
agreed  upon  by  the  heads  of  the  respective  departments.  In 
case  of  disobedience  to  a  subpoena,  the  bureau  may  invoke  the 
aid  of  any  district  court  of  the  United  States  in  requiring  the 

89 


attendance  and  testimony  of  witnesses  and  the  production  of 
documentary  evidence,  and  such  court,  within  the  jurisdiction  of 
which  the  inquiry  is  carried  on,  may,  in  case  of  contumacy  or 
refusal  to  obey  a  subpoena  issued  to  any  officer,  agent,  or  em- 
ployee of  any  corporation  or  other  person,  issue  an  order  re- 
quiring such  corporation  or  other  person  to  appear  before  the 
bureau,  or  to  give  evidence  touching  the  matter  in  question;  and 
any  failure  to  obey  such  order  of  the  court  may  be  punished 
by  such  court  as  a  contempt  thereof.  Any  person  so  required 
to  attend  as  a  witness  shah1  be  allowed  and  paid  the  same  fees 
and  mileage  as  are  paid  witnesses  in  the  district  courts  of  the 
United  States. 

SEC.  16.  That  the  director  shall  submit  annually  to  the  Secre- 
tary of  the  Treasury  estimates  of  the  appropriations  necessary 
for  the  work  of  the  bureau. 

SEC.  17.  That  for  the  purpose  of  carrying  out  the  provisions 
of  this  Act  there  is  hereby  appropriated,  out  of  any  moneys  in 
the  Treasury  not  otherwise  appropriated,  the  sum  of  $100,000, 
for  the  payment  of  all  expenses  incident  to  the  work  authorized 
under  this  Act,  including  salaries  of  the  director  and  commis- 
sioners and  of  such  deputies,  assistants,  accountants,  experts, 
clerks,  and  other  employees  in  the  District  of  Columbia  or  else- 
where, as  the  Secretary  of  the  Treasury  may  deem  necessary, 
traveling  expenses,  rent  and  equipment  of  offices,  typewriters 
and  exchange  of  same,  purchase  of  law  books  and  books  of  refer- 
ence, printing  and  binding  to  be  done  at  the  Government  Print- 
ing Office,  and  all  other  necessary  expenses.  With  the  exception 
of  the  director,  the  commissioners,  and  such  special  experts  as 
the  Secretary  of  the  Treasury  may  from  time  to  time  find  neces- 
sary for  the  conduct  of  the  work  of  the  bureau,  all  employees 
of  the  bureau  shall  be  appointed  from  lists  of  eligibles  to  be  sup- 
plied by  the  Civil  Service  Commission  and  in  accordance  with 
the  civil-service  law.  Such  fees,  allowances,  and  salaries  shall  be 
the  same  as  are  paid  for  similar  services  in  other  departments  of 
the  Government. 

SEC.  18.  That  there  is  hereby  appropriated  from  any  moneys 
in  the  Treasury  not  otherwise  appropriated,  the  sum  of  $141,000,- 
000,  to  be  known  as  the  military  and  naval  family  allowance 
appropriation,  for  the  payment  of  the  family  allowances  pro- 
vided by  Article  II.  Payments  out  of  this  appropriation  shall 
be  made  upon  and  in  accordance  with  awards  by  the  Commis- 
sioner of  the  Division  of  Military  and  Naval  Insurance. 

SEC.  19.  That  there  is  hereby  appropriated,  from  any  money 
in  the  Treasury  not  otherwise  appropriated,  the  sum  of  $12,150,- 
000,  to  be  known  as  the  military  and  naval  compensation  appro- 
priation, for  the  payment  of  the  compensation,  funeral  expenses, 
services,  and  supplies  provided  by  Article  III.  Payments  out  of 
this  appropriation  shall  be  made  upon  and  in  accordance  with 
awards  by  the  director. 

SEC.  20.  That  there  is  hereby  appropriated,  from  any  money 
in  the  Treasury  not  otherwise  appropriated,  the  sum  of  $23,000,- 
000,  to  be  known  as  the  military  and  naval  insurance  appropria- 
tion. All  premiums  may  be  collected  for  the  insurance  provided 

90 


by  the  provisions  of  Article  IV  shall  be  deposited  and  covered 
into  the  Treasury  to  the  credit  of  this  appropriation. 

Such  sum,  including  all  premium  payments,  is  hereby  made 
available  for  the  payment  of  the  liabilities  of  the  United  States 
incurred  under  contracts  of  insurance  made  under  the  provisions 
of  Article  IV.  Payments  from  this  appropriation  shall  be  made 
upon  and  in  accordance  with  awards  by  the  director. 

SEC.  21.  That  there  shall  be  set  aside  as  a  separate  fund  in 
the  Treasury,  to  be  known  as  the  military  and  naval  pay  deposit 
fund,  all  sums  held  out  of  pay  as  provided  by  section  two  hun- 
dred and  three  of  this  Act.  Such  fund,  including  all  additions, 
is  hereby  made  available  for  the  payment  of  the  sums  so  held 
and  deposited,  with  interest,  as  provided  in  section  two  hun- 
dred and  three,  and  the  amount  necessary  to  pay  interest  is 
hereby  appropriated. 

SEC.  22.  That  for  the  purpose  of  this  amendatory  Act  the  mar- 
riage of  a  claimant  to  the  person  on  account  of  whom  the 
claim  is  made  shall  be  shown — 

(1)  By  a  duly  verified  copy  of  a  public  or  church  record;  or 

(2)  By  the  affidavit  of  the  clergyman  or  magistrate  who  offici- 
ated; or 

(3)  By  the  testimony  of  two  or  more  eyewitnesses  to  the  cere- 
mony; or 

(4)  By  a  duly  verified  copy  of  the  church  record  of  baptism 
of  the  children;  or 

(5)  By  the  testimony  of  two  or  more  witnesses  who  know 
that  the  parties  lived  together  as  husband  and  wife,  and  were 
recognized  as  such,  and  who  shall  state  how  long,  within  their 
knowledge,  such  relation  continued:  Provided,  That  marriages, 
except  such  as  are  mentioned  in  section  forty-seven  hundred  and 
five  of  the  Revised  Statutes,  shall  be  proven  in  compensation  or 
insurance  cases  to  be  legal  marriages  according  to  the  law  of  the 
place  where  the  parties  resided  at  the  time  of  marriage  or  at  the 
time  when  the  right  to  compensation  or  insurance  accrued;  and 
the  open  and  notorious  illicit  cohabitation  of  a  widow  who  is  a 
claimant  shall  operate  to  terminate  her  right  to  compensation 
or   insurance   from   the   commencement    of   such   cohabitation: 
Provided  further,  That  for  the  purpose  of  the  administration  of 
Article  II  of  this  Act  marriage  shall  be  conclusively  presumed, 
in  the  absence  of  proof,  that  there  is  a  legal  spouse  living,  if  the 
man  and  woman  have  lived  together  in  the  openly  acknowledged 
relation  of  husband  and  wife  during  the  two  years  immediately 
preceding  the  date  of  the  declaration  of  war,  or  the  date  of  en- 
listment or  of  entrance  into  or  employment  in  active  service  in 
the  military  or  naval  forces  of  the  United  States  if  subsequent 
to  such  declaration. 

In  Articles  II,  III,  and  IV  of  this  Act  unless  the  context  other- 
wise requires — 

(1)  The  term  "child"  includes— 

(a)  A  legitimate  child. 

(b)  A  child  legally  adopted  more  than  six  months  before  the 
enactment  of  this  amendatory  Act  or  before  enlistment  or  en- 
trance  into   or   employment   in   active   service   in   the   military 

91 


or  naval  forces  of  the  United  States,  whichever  of  these  dates 
is  the  later. 

(c)  A  stepchild,  if  a  member  of  the  man's  household. 

(d)  An  illegitimate  child,  but,  as  to  the  father,  only,  if  ac- 
knowledged by  instrument  in  writing  signed  by  him,  or  if  he 
has  been  judiciously  ordered  or  decreed  to  contribute  to  such 
child's  support,  and  if  such  child,  if  born  after  December  thirty- 
first,  nineteen  hundred  and  seventeen,  shall  have  been  born  in 
the  United  States,  or  in  its  insular  possessions. 

(2)  The  term  "grandchild"  means  a  child  as  above  defined  of 
a  child  as  above  defined. 

(3)  Except  as  used  in  section  four  hundred  and  one  and  in  sec- 
tion four  hundred  and  two  the  terms  "child"  and  "grandchild" 
are  limited  to  unmarried  persons  either  (a)  under  eighteen  years 
of  age,  or  (b)  of  any  age,  if  insane,  idiotic,  or  otherwise  perma- 
nently helpless. 

(4)  The  term  "parent"  includes  a  father,  mother,  grandfather, 
grandmother,  father  through  adoption,  mother  through  adoption, 
stepfather,  and  stepmother,  either  of  the  person  in  the  service  or 
of  the  spouse. 

(5)  The  term  "brother"  and  "sister"  include  brothers  and  sis- 
ters of  the  half  blood  as  well  as  those  of  the  whole  blood,  step- 
brothers and  stepsisters,  and  brothers  and  sisters  through  adop- 
tion. 

(6)  The  term  "commissioned  officer"  includes  a  warrant  offi- 
cer, but  includes  only  an  officer  in  active  service  in  the  military 
or  naval  forces  of  the  United  States. 

(7)  The   terms   "man"   and   "enlisted   man"   mean   a   person, 
whether  male  or  female,  and  whether  enlisted,  enrolled,  or  drafted 
into  active  service  in  the  military  or  naval  forces  of  the  Unite 
States,   and   include   noncommissioned   and  petty   officers,   and 
members  of  training  camps  authorized  by  law. 

(8)  The  term  "enlistment"  includes  voluntary  enlistment,  draft, 
and  enrollment  in  active  service  in  the  military  or  naval  forces 
of  the  United  States. 

(9)  The  term  "commissioner"  means  the  Commissioner  of  Mili- 
tary and  Naval  Insurance. 

(10)  The  term  "injury"  indues  disease. 

.  (11)  The  term  "pay"  means  the  pay  for  service  in  the  United 
States  according  to  grade  and  length  of  service,  excluding  all 
allowances. 

(12)  The  term  "military  or  naval  forces"  means  the  Army,  the 
Navy,  the  Marine  Corps,  the  Coast  Guard,  the  Naval  Reserves,  the 
National  Naval  Volunteers,  and  any  other  branch  of  the  United 
States  service  while  serving  pursuant  to  law  with  the  Army  or 
the  Navy. 

SEC.  23.  That  when,  by  the  terms  of  this  amendatory  Act  any 
payment  is  to  be  made  to  a  minor,  other  than  a  person  in  the 
military  or  naval  forces  of  the  United  States,  or  to  a  person 
mentally  incompetent,  such  payment  shall  be  made  to  the  per- 
son who  is  constituted  guardian  or  curator  by  the  laws  of  the 
State  or  residence  of  claimant,  or  is  otherwise  legally  vested 
with  responsibility  or  care  of  the  claimant. 

92 


SEC.  24.  That  the  Bureau  of  War  Risk  Insurance,  so  far  as 
practicable,  shall  upon  request  furnish  information  to  and  act 
for  persons  in  the  military  or  naval  service,  with  respect  to 
any  contracts  of  insurance  whether  with  the  Government  or 
otherwise,  as  may  be  prescribed  by  regulations.  Said  bureau 
may  upon  request  procure  from  and  keep  a  record  of  the  amount 
and  kind  of  insurance  held  by  every  commissioned  and  ap- 
pointive officer  and  of  every  enlisted  man  in  the  military  or  naval 
service  of  the  United  States,  including  the  name  and  principal 
place  of  business  of  the  company,  society,  or  organization  in 
which  such  insurance  is  held,  the  date  of  the  policy,  amount 
of  premium,  name  and  relationship  of  the  beneficiary,  and  such 
other  data  as  may  be  deemed  of  service  in  protecting  the  inter- 
ests of  the  insured  and  beneficiaries. 

SEC.  25.  That  whoever  in  any  claim  for  family  allowance,  com- 
pensation, or  insurance,  or  in  any  document  required  by  this  Act 
or  by  regulation  made  under  this  Act,  makes  any  statement  of 
a  material  fact  knowing  it  to  be  false,  shall  be  guilty  of  perjury 
and  shall  be  punished  by  a  fine  of  not  more  than  $5,000,  or  by 
imprisonment  for  not  more  than  two  years  or  both. 

SEC.  26.  That  if  any  person  entitled  to  payment  of  family  allow- 
ance or  compensation  under  this  Act,  whose  right  to  such  pay- 
ment under  this  Act  ceases  upon  the  happening  of  any  contin- 
gency, thereafter  fraudulently  accepts  any  such  payment,  he  shall 
be  punished  by  a  fine  of  not  more  than  $2,000,  or  by  imprison- 
ment for  not  more  than  one  year,  or  both. 

SEC.  27.  That  whoever  shall  obtain  or  receive  any  money, 
check,  allotment,  family  allowance,  compensation,  or  insurance 
under  Articles  II,  III,  or  IV  of  this  Act,  without  being  entitled 
thereto,  with  intent  to  defraud  the  United  States,  or  any  person 
in  the  military  or  naval  forces  of  the  United  States,  shall  be  pun- 
ished by  a  fine  of  not  more  than  $2,000,  or  by  imprisonment  for 
not  more  than  one  year  or  both. 

SEC.  28.  That  the  allotments  and  family  allowances,  compensa- 
tion, and  insurance  payable  under  Articles  II,  III,  and  IV,  respec- 
tively, shall  not  be  assignable;  shall  not  be  subject  to  the  claims 
of  creditors  of  any  person  to  whom  an  award  is  made  under 
Articles  II,  III,  or  IV;  and  shall  be  exempt  from  all  taxation: 
Provided,  That  such  allotments  and  family  allowances,  compen- 
sation, and  insurance  shall  be  subject  to  any  claims  which  the 
United  States  may  have,  under  Articles  II,  III,  and  IV,  against 
the  person  on  whose  account  the  allotments  and  family  allow- 
ances, compensation,  or  insurance  is  payable. 

SEC.  29.  That  the  discharge  or  dismissal  of  any  person  from 
the  military  or  naval  forces  on  the  ground  that  he  is  an  enemy 
alien,  conscientious  objector,  or  a  deserter,  or  as  guilty  of  mutiny, 
treason,  spying,  or  any  offense  involving  moral  turpitude,  or  wil- 
ful and  persistent  misconduct  shall  terminate  any  insurance 
granted  on  the  life  of  such  person  under  the  provisions  of  Ar- 
ticle IV,  and  shall  bar  all  rights  to  any  compensation  under 
Article  III  or  any  insurance  under  Article  IV. 

SEC.  30.  That  this  Act  may  be  cited  as  the  war-risk  insurance 
Act. 

93 


ARTICLE  II. 

ALLOTMENTS    AND    FAMILY    ALLOWANCES 

SEC.  200.  That  the  provisions  of  this  article  shall  apply  to  all 
enlisted  men  in  the  military  or  naval  forces  of  the  United  States, 
except  the  Philippine  Scouts,  the  insular  force  of  the  Navy,  and 
the  Samoan  native  guard  and  band  of  the  Navy. 

SEC.  201.  That  allotment  of  pay  shall,  subject  to  the  conditions, 
limitations,  and  exceptions  hereinafter  specified,  be  compulsory 
as  to  wife,  former  wife  divorced  who  has  not  remarried  and  to 
whom  alimony  has  been  decreed,  and  a  child,  and  voluntary  as 
to  any  other  person;  but  on  the  written  consent  of  the  wife  or 
former  wife  divorced,  supported  by  evidence  satisfactory  to  the 
bureau  of  her  ability  to  support  herself  and  the  children  in  her 
custody,  the  allotment  for  her  and  for  such  children  may  be 
waived;  and  on  the  enlisted  man's  application  or  otherwise  for 
good  cause  shown,  exemption  from  the  allotment  may  be  granted 
upon  such  conditions  as  may  be  prescribed  by  regulations. 

The  monthly  compulsory  allotment  shall  be  $15.  For  a  wife 
living  separate  and  apart  from  her  husband  under  court  order 
or  written  agreement,  or  for  a  former  wife  divorced,  the  monthly 
compulsory  allotment  shall  not  exceed  the  amount  specified  in 
the  court  order,  decree,  or  written  agreement  to  be  paid  to  her, 
and  for  an  illegitimate  child,  to  whose  support  the  father  has 
been  judicially  ordered  or  decreed  to  contribute,  it  shall  not 
exceed  the  amount  fixed  in  the  order  or  decree. 

If  there  is  a  compulsory  allotment  for  a  wife  or  child,  then 
a  former  wife  divorced  who  has  not  remarried  and  to  whom 
alimony  has  been  decreed,  shall  not  be  entitled  to  a  compulsory 
allotment,  but  shall  be  entitled  to  a  family  allowance  as  herein- 
after provided.1 

SEC.  202.  That  the  enlisted  man  may  allot  any  proportion  or 
proportions  or  any  fixed  amount  or  amounts  of  his  monthly  pay 
or  of  the  proportion  thereof  remaining  after  the  compulsory 
allotments,  for  such  purposes  and  for  the  benefit  of  such  person 
or  persons  as  he  may  direct,  subject,  however,  to  such  conditions 
and  limitations  as  may  be  prescribed  under  regulations  to  be 
made  by  the  Secretary  of  War  and  the  Secretary  of  the  Navy, 
respectively. 

SEC.  203.  That  in  case  one-half  of  an  enlisted  man's  monthly 
pay  is  not  allotted,  regulations  to  be  made  by  the  Secretary  of 
War  and  the  Secretary  of  the  Navy,  respectively,  may  require, 
under  circumstances  and  conditions  as  may  be  prescribed  in  such 
regulations,  that  any  proportion  of  such  one-half  pay  as  is  not 
allotted  shall  be  deposited  to  his  credit,  to  be  held  during  such 
period  of  his  service  as  may  be  prescribed.  Such  deposit  shall 
bear  interest  at  the  same  rate  as  United  States  bonds  bear  for  the 
same  period,  and,  when  payable,  shall  be  paid  principal  and  in- 
terest to  the  enlisted  man,  if  living,  otherwise  to  any  beneficiary 
or  beneficiaries  he  may  have  designated,  or  if  there  be  no  such 
beneficiary,  then  to  the  person  or  persons  who,  under  the  laws 
1  This  section  as  amended  takes  effect  on  the  first  day  of  July,  1918. 

94 


of  the  State  of  his  residence,  would  be  entitled  to  his  personal 
property  in  case  of  intestacy. 

SEC.  204.  That  a  family  allowance  of  not  exceeding  $50  per 
month  shall  be  granted  and  paid  by  the  United  States  upon  writ- 
ten application  to  the  bureau  by  such  enlisted  man  or  by  or  on 
behalf  of  any  prospective  beneficiary,  in  accordance  with  and 
subject  to  the  conditions,  limitations  and  exceptions  hereinafter 
specified. 

The  family  allowance  shall  be  paid  from  the  time  of  enlistment 
to  death  in  or  one  month  after  discharge  from  the  service,  but  not 
for  more  than  one  month  after  the  termination  of  the  present 
war  emergency.  No  family  allowance  shall  be  made  for  any 
period  preceding  November  first,  nineteen  hundred  and  seven- 
teen. The  payment  shall  be  subject  to  such  regulations  as  may 
be  prescribed  relative  to  cases  of  desertion  and  imprisonment 
and  of  missing  men. 

Class  A.  In  the  case  of  a  man  to  his  wife  (including  a  former 
wife  divorced)  and  to  his  child  or  children — 

(a)  If  there  is  a  wife  but  no  child,  $15; 

(b)  If  there  is  a  wife  and  one  child,  $25; 

(c)  If  there  is  a  wife  and  two  children,  $32.50,  with  $5  per 
month  additional  for  each  additional  child; 

(d)  If  there  is  no  wife,  but  one  child,  $5; 

(e)  If  there  is  no  wife,  but  two  children,  $12.50; 

(f)  If  there  is  no  wife,  but  three  children,  $20; 

(g)  If  there  is  no  wife,  but  four  children,  $30,  with  $5  per 
month  additional  for  each  additional  child; 

(h)  If  there  is  a  former  wife  divorced  who  has  not  remarried 
and  to  whom  alimony  has  been  decreed,  $15. 

Class  B.  In  the  case  of  a  man  or  woman  to  a  grandchild,  a 
parent,  brother,  or  sister — 

(a)  If  there  is  one  parent,  $10; 

(b)  If  there  are  two  parents,  $20; 

(c)  If   there   is   a   grandchild,   brother,    sister,    or   additional 
parent,  $5  for  each. 

In  the  case  of  a  woman,  the  family  allowances  for  a  husband 
and  children  shall  be  in  the  same  amounts,  respectively,  as  are 
payable,  in  the  case  of  a  man,  to  a  wife  and  children,  provided 
she  makes  a  voluntary  allotment  of  $15  as  a  basis  therefor,  and 
provided,  further,  that  dependency  exists  as  required  in  section 
two  hundred  and  six.1 

SEC.  205.  That  family  allowances  for  members  of  Class  A  shall 
be  paid  only  if  and  while  a  compulsory  allotment  is  made  to 
a  member  or  members  of  such  class.  The  monthly  family  allow- 
ance to  a  former  wife  divorced  shall  be  payable  only  out  of  the 
difference,  if  any,  between  the  monthly  family  allowance  to  the 
other  members  of  Class  A  and  the  sum  of  $50,  and  only  then 
if  alimony  shall  have  been  decreed  to  her.  For  a  wife  living 
separate  and  apart  under  court  order  or  written  agreement  or 
to  a  former  wife  divorced  the  monthly  allowance,  together  with 
the  allotment,  if  any,  shall  not  exceed  the  amount  specified  in 
the  court  order,  decree,  or  written  agreement  to  be  paid  to  her. 

1This    section    as    amended    takes    effect   on    the   first    of   July,    1918. 

95 


For  an  illegitimate  child,  to  whose  support  the  father  has  been 
judicially  ordered  or  decreed  to  contribute,  it  shall  not  exceed 
the  amount  fixed  in  the  order  or  decree. 

SEC.  206.  That  family  allowances  to  members  of  class  B  shall 
be  paid  only  if  and  while  the  members  are  dependent  in  whole 
or  in  part  on  the  enlisted  man,  and  then  only  if  and  while  the 
enlisted  man  makes  a  monthly  allotment  of  his  pay  for  such  mem- 
bers in  the  following  amounts: 

(a)  If  an  enlisted  man  is  not  making  a  compulsory  allotment 
for  Class  A  the  allotment  for  class  B  required  as  a  condition 
to  the  family  allowance  shall  be  $15; 

(b)  If  an  enlisted  man  is  making  a  compulsory  allotment  for 
class  A  the  additional  allotment  for  class  B  required  as  a  con- 
dition to  the  family  allowance  shall  be  $5,  or  if  a  woman  is 
making  an  allotment  of  $15  for  a  dependent  husband  or  child 
the  additional  allotment  for  the  other  members  of  class  B  required 
as  a  condition  to  the  family  allowance  shall  be  $5.* 

SEC.  207.  That  the  amount  of  the  family  allowance  to  mem- 
bers of  class  B  shall  be  subject  to  each  of  the  following  limita- 
tions : 

(a)  If  an  allowance  is  paid  to  one  or  more  beneficiaries  of 
Class  A,  the  total  allowance  to  be  paid  to  the  beneficiaries  of 
Class  B  shall  not  exceed  the  difference  between  the  allowance 
paid  to  the  beneficiaries  of  Class  A  and  the  sum  of  $50. 

(b)  The  total  monthly  allowance  to  beneficiaries  of  Class  B 
added  to  the  enlisted  man's  monthly  allotment  to  them  shall  not 
exceed  the  average  sum  habitually  contributed  by  him  to  their 
support  monthly  during  the  period  of  dependency,  but  not  ex- 
ceeding a  year  immediately  preceding  his  enlistment  or  the  en- 
actment of  this  amendatory  Act. 

SEC.  208.  That  as  between  the  members  of  Class  A  and  as  be- 
tween the  members  of  Class  B,  the  amount  of  the  allotment  and 
family  allowance  shall  be  apportioned  as  may  be  prescribed 
by  regulations. 

SEC.  209.  The  War  and  Navy  Departments,  respectively,  shall 
pay  over  to  the  Treasury  Department  monthly  the  entire  amount 
of  such  allotments  for  distribution  to  the  beneficiaries,  and  the 
allotments  and  family  allowances  shall  be  paid  by  the  bureau  to 
or  for  the  beneficiaries. 

SEC.  210.  That  upon  receipt  of  any  application  for  family  allow- 
ance, the  commissioner  shall  make  all  proper  investigations  and 
shall  make  an  award,  on  the  basis  of  which  award  the  amount 
of  the  allotments  to  be  made  by  the  man  shall  be  certified  to  the 
War  Department  or  Navy  Department,  as  may  be  proper.  When- 
ever the  commissioner  shall  have  reason  to  believe  that  an  allow- 
ance has  been  improperly  made  or  that  the  conditions  have 
changed,  he  shall  investigate  or  reinvestigate  and  may  modify 
the  award.  The  amount  of  each  monthly  allotment  and  allowance 
shall  be  determined  according  to  the  family  conditions  existing 
on  the  first  day  of  the  month.1 


1  This  section   as  amended  takes  effect  on  the  first  of  July,  1918. 

96 


ARTICLE  III. 

COMPENSATION    FOR   DEATH   OR  DISABILITY 

SEC.  300.  That  for  death  or  disability  resulting  from  personal 
injury  suffered  or  disease  contracted  in  the  line  of  duty,  by  any 
commissioned  officer  or  enlisted  man  or  by  any  member  of  the 
Army  Nurse  Corps  (female)  or  of  the  Navy  Nurse  Corps  (female) 
when  employed  in  the  active  service  under  the  War  Department 
or  Navy  Department,  the  United  States  shall  pay  compensation  as 
hereinafter  provided;  but  no  compensation  shall  be  paid  if  the 
injury  or  disease  has  been  caused  by  his  own  willful  misconduct : 
Provided,  That  for  the  purposes  of  this  section  said  officer,  en- 
listed man,  or  other  member  shall  be  held  and  taken  to  have 
been  in  sound  condition  when  examined,  accepted,  and  enrolled 
for  service:  Provided  further,  That  this  section,  as  amended, 
shall  be  deemed  to  become  effective  as  of  October  sixth,  nineteen 
hundred  and  seventeen. 

SEC.  301.  That  if  death  results  from  injury — 

If  the  deacesed  leaves  a  widow  or  child,  or  if  he  leaves  a 
widowed  mother  dependent  upoi}  him  for  support,  the  monthly 
compensation  shall  be  the  following  amounts : 

(a)  For  a  widow  alone,  $25. 

(b)  For  a  widow  and  one  child,  $35. 

(c)  For  a  widow  and  two  children,  $47.50,  with  $5  for  each 
additional  child  up  to  two. 

(d)  If  there  be  no  widow,  then  for  one  child,  $20. 

(e)  If  there  is  no  widow,  but  two  children,  $30. 

(f)  If  there  is  no  widow,  but  three  children,  $40,  with  $5  for 
each  additional  child  up  to  two; 

(g)  If  there  is  a  dependent  mother  (or  dependent  father),  $20, 
or  both,  $30.    The  amount  payable  under  this  subdivision  shall 
not  exceed  the  difference  between  the  total  amount  payable  to 
the  widow  and  children  and  the  sum  of  $75.    This  compensation 
shall  be  payable  for  the  death  of  but  one  child,  and  no  compensa- 
tion for  the  death  of  a  child  shall  be  payable  if  the  dependent 
mother  is  in  receipt  of  compensation  under  the  provisions  of 
this  article  for  the  death  of  her  husband.     Such  compensation 
shall  be  payable  whether  the  dependency  of  the  father  or  mother 
or  both  arises  before  or  after  the  death  of  the  person,  but  no  com- 
pensation shall  be  payable  if  the  dependency  arises  more  than 
five  years  after  the  death  of  the  person. 

If  the  death  occurs  before  discharge  or  resignation  from  serv- 
ice, the  United  States  shall  pay  for  burial  expenses  and  the  return 
of  the  body  to  his  home  a  sum  not  to  exceed  $100,  as  may  be 
fixed  by  regulations. 

The  payment  of  compensation  to  a  widow  shall  continue  until 
her  death  or  remarriage. 

The  payment  of  compensation  to  or  for  a  child  shall  continue 
until  such  child  reaches  the  age  of  eighteen  years  or  marries,  or 
if  such  child  is  incapable,  because  of  insanity,  idiocy,  or  being 
otherwise  permanently  helpless,  then  during  such  incapacity. 

Whenever  the  compensation  payable  to  or  for  the  benefit  of 

97 


any  person  under  the  provisions  of  this  section  is  terminated 
by  the  happening  of  the  contingency  upon  which  it  is  limited,  the 
compensation  thereafter  for  the  remaining  beneficiary  or  bene- 
ficiaries, if  any,  shall  be  the  amount  which  would  have  been  pay- 
able to  them  if  they  had  been  the  sole  original  beneficiaries. 

As  between  the  widow  and  the  children,  not  in  her  custody, 
and  as  between  children,  the  amount  of  the  compensation  shall 
be  apportionel  as  may  be  prescribed  by  regulation. 

The  term  "widow"  as  used  in  this  section  shall  not  include  one 
who  shall  have  married  the  deceased  later  than  ten  years  after 
the  time  of  injury,  and  shall  include  a  widower,  whenever  his 
condition  is  such  that,  if  the  deceased  person  were  living,  he 
would  have  been  dependent  upon  her  for  support.1 

SEC.  302.  That  if  disability  results  from  the  injury — 

(1)  If  and  while  the  disability  is  total,  the  monthly  compensa- 
tion shall  be  the  following  amounts: 

(a)  If  he  has  neither  wife  nor  child  living,  $30. 

(b)  If  he  has  a  wife  but  no  child  living,  $45. 

(c)  If  he  has  a  wife  and  one  child  living,  $55. 

(d)  If  he  has  a  wife  and  two  children  living,  $65. 

(e)  If  he  has  a  wife  and  three  or  more  children  living,  $75. 

(f)  If  he  has  no  wife,  but  one  child  living,  $40,  with  $10  for 
each  additional  child  up  to  two. 

(g)  If  he  has  a  widowed  mother  dependent  on  him  for  support, 
then,  in  addition  to  the  above  amounts,  $10. 

(h)  If  he  is  totally  disabled  and  in  addition  so  helpless  as  to 
be  in  constant  need  of  a  nurse  or  attendant,  such  additional  sum 
shall  be  paid,  but  not  exceeding  $20  per  month,  as  the  director 
may  deem  reasonable:  Provided,  however.  That  for  the  loss  of 
both  feet  or  both  hands  or  both  eyes,  or  for  becoming  totally 
blind  or  becoming  helpless  and  permanently  bedridden  from 
causes  occurring  in  the  line  of  duty  in  the  service  of  the  United 
States,  the  rate  of  compensation  shall  be  $100  per  month:  Provided 
further,  That  where  the  rate  of  compensation  is  $100  per  month, 
no  allowance  shall  be  made  for  a  nurse  or  attendant. 

(2)  If  and  while  the  disability  is  partial,  the  monthly  compen- 
sation shall  be  a  percentage  of  the  compensation  that  would  be 
payable  for  his  total  disability  equal  to  the  degree  of  the  reduc- 
tion in  earning  capacity  resulting  from  the  disability,  but  no  com- 
pensation shall  be  payable  for  a  reduction  in  earning  capacity 
rated  at  less  than  ten  per  centum. 

A  schedule  of  ratings  of  reductions  in  earning  capacity  from 
specific  injuries  or  combinations  of  injuries  of  a  permanent 
nature  shall  be  adopted  and  applied  by  the  bureau.  Ratings 
may  be  as  high  as  one  hundred  per  centum.  The  ratings  shall 
be  based,  as  far  as  practicable,  upon  the  average  impairments  of 
earning  capacity  resulting  from  such  injuries  in  civil  occupations 
and  not  upon  the  impairment  in  earning  capacity  in  each  indi- 
vidual case,  so  that  there  shall  be  no  reduction  in  the  rate  of  com- 
pensation for  individual  success  in  overcoming  the  handicap 
of  a  permanent  injury.  The  bureau  shall  from  time  to  time 
readjust  this  schedule  of  ratings  in  accordance  with  actual  ex- 
perience. 

irThis   section   as   amended   takes   effect  on   the   first   of  July,   1918. 

98 


(3)  In  addition  to  the  compensation  above  provided,  the  in- 
jured person  shall  be  furnished  by  the  United  States  such  reason- 
able governmental  medical,  surgical,  and  hospital  services  and 
with  such  supplies,  including  artificial  limbs,  trusses,  and  similar 
appliances,  as  the  director  may  determine  to  be  useful  and  reason- 
ably necessary:  Provided,  That  nothing  in  this  Act  shall  be  con- 
strued to  affect  the  necessary  military  control  over  any  member 
of  the  military  or  naval  establishments  before  he  shall  have  been 
discharged  from  the  military  or  naval  service. 

(4)  The  amount  of  each  monthly  payment  shall  be  determined 
according  to  the  family  conditions  existing  on  the  first  day  of 
the  month. 

(5)  Where  the  disabled  person  and  his  wife  are  not  living  to- 
gether, or  where  the  children  are  not  in  the  custody  of  the  dis- 
abled person,  the  amountof  the  compensation  shall  be  apportioned 
as  may  be  prescribed  by  regulations. 

(6)  The  term   "wife"  as  used  in   this  section   shall   include 
"husband"  if  the  husband  is  dependent  upon  the  wife  for  support. 

SEC.  303.  That  every  person  applying  for  or  in  receipt  of  com- 
pensation for  disability  under  the  provisions  of  this  article  shall, 
as  frequently  and  at  such  times  and  places  as  may  be  reason- 
ably be  required,  submit  himself  to  examination  by  a  medical 
officer  of  the  United  States  or  by  a  duly  qualified  physician  des- 
ignated or  approved  by  the  director.  He  may  have  a  duly  quali- 
fied physician  designated  and  paid  by  him  present  to  participate 
in  such  examination.  For  all  examinations  he  shall,  in  the  dis- 
cretion of  the  director,  be  paid  his  reasonable  traveling  and  other 
expenses  and  also  loss  of  wages  incurred  in  order  to  submit  to 
such  examination.  If  he  refuses  to  submit  himself  for,  or  in 
any  way  obstructs,  any  examination,  his  right  to  claim  compen- 
sation under  this  article  shall  be  suspended  until  such  refusal 
or  obstruction  ceases.  No  compensation  shall  be  payable  while 
such  refusal  or  obstruction  continues,  and  no  compensation  shall 
be  payable  for  the  intervening  period, 

Every  person  in  receipt  of  compensation  for  disability  shall 
submit  to  any  reasonable  medical  or  surgical  treatment  furnished 
by  the  bureau  whenever  requested  by  the  bureau;  and  the  con- 
sequences of  unreasonable  refusal  to  submit  to  any  such  treatment 
shall  not  be  deemed  to  result  from  the  injury  compensated  for. 

SEC.  304.  [This  section  was  repealed  by  act  of  June  27,  1918 — 
vocational  rehabilitation  act — Public — No.  178 — 65th  Cong.] 

SEC.  305.  That  upon  its  own  motion  or  upon  application  the 
bureau  may  at  any  time  review  an  award,  and,  in  accordance 
with  the  facts  found  upon  such  review,  may  end,  diminish,  or 
increase  the  compensation  previously  awarded,  or,  if  compensa- 
tion has  been  refused  or  discontinued,  may  award  compensation. 

SEC.  306.  That  no  compensation  shall  be  payable  for  death  or 
disability  which  does  not  occur  prior  to  or  within  one  year  after 
discharge  or  resignation  from  the  service,  except  that  where, 
after  a  medical  examination  made  pursuant  to  regulations,  at  the 
time  of  discharge  or  resignation  from  the  service,  or  within 
such  reasonable  time  thereafter,  not  exceeding  one  year,  as  may 
be  allowed  by  regulations,  a  certificate  has  been  obtained  from 

99 


the  director  to  the  effect  that  the  injured  person  at  the  time  of 
his  discharge  or  resignation  was  suffering  from  injury  likely  to 
result  in  death  or  disability,  compensation  shall  be  payable  for 
death  or  disability,  whenever  occurring,  proximately  resulting 
from  such  injury. 

SEC.  307.  That  compensation  shall  not  be  payable  for  death  in 
the  course  of  the  service  until  the  death  be  officially  recorded  in 
the  department  under  which  he  may  be  serving.  No  compensa- 
tion shall  be  payable  for  a  period  during  which  the  man  has 
been  reported  "missing"  and  a  family  allowance  has  been  paid 
for  him  under  the  provisions  of  Article  II. 

SEC.  308.  That  no  compensation  shall  be  payable  for  death 
inflicted  as  a  lawful  punishment  for  a  crime  or  military  offense 
except  when  inflicted  by  the  enemy.  A  dismissal  or  dishonor- 
able or  bad  conduct  discharge  from  the  service  shall  bar  and 
terminate  all  right  to  any  compensation  under  the  provisions  of 
this  article. 

SEC.  309.  That  no  compensation  shall  be  payable  unless  a  claim 
therefor  be  filed,  in  case  of  disability,  within  five  years  after  dis- 
charge or  resignation  from  the  service,  or,  in  case  of  death  during 
the  service,  within  five  years  after  such  death  is  officially  recorded 
in  the  department  under  which  he  may  be  serving:  Provided, 
however,  That  where  compensation  is  payable  for  death  or  dis- 
ability occurring  after  discharge  or  resignation  from  the  service, 
claim  must  be  made  within  five  years  after  such  death  or  the 
beginning  of  such  disability. 

The  time  herein  provided  may  be  extended  by  the  director 
not  to  exceed  one  year  for  good  cause  shown.  If  at  the  time 
that  any  right  accrues  to  any  person  under  the  provisions  of  this 
article,  such  person  is  a  minor,  or  is  of  unsound  mind  or  physi- 
cally unable  to  make  a  claim,  the  time  herein  provided  shall  not 
begin  to  run  until  such  disability  ceases. 

SEC.  310.  That  no  compensation  shall  be  payable  for  any  period 
more  than  two  years  prior  to  the  date  of  claim  therefor,  nor 
shall  increased  compensation  be  awarded  to  revert  back  more 
than  one  year  prior  to  the  date  of  claim  therefor. 

SEC.  311.  [This  section  was  repealed  by  act  of  June  25,  1918. 
The  substance  is  now  included  in  section  28.] 

SEC.  312.  That  compensation  under  this  article  shall  not  be 
paid  while  the  person  is  in  receipt  of  service  or  retirement  pay. 
The  laws  providing  for  gratuities  or  payments  in  the  event  of 
death  in  the  service  and  existing  pension  laws  shall  not  be  ap- 
plicable after  the  enactment  of  this  amendment  to  any  person 
in  the  active  military  or  naval  service  on  the  sixth  day  of  October^ 
nineteen  hundred  and  seventeen,  or  who  thereafter  entered  the 
active  military  or  naval  service,  or  to  their  widows,  children,  or 
their  dependents,  except  in  so  far  as  rights  under  any  such  law 
have  heretofore  accrued. 

Compensation  because  of  disability  or  death  of  members  of  the 
Army  Nurse  Corps  (female)  or  of  the  Navy  Nurse  Corps  (female) 
shall  be  in  lieu  of  any  compensation  for  such  disability  or  death 
under  the  Act  entitled  "An  Act  to  provide  compensation  for  em- 
ployees of  the  United  States  suffering  injuries  while  in  the  per- 

100 


formance  of  their  duties,  and  for  other  purposes,"  approved  Sep- 
tember seventh,  nineteen  hundred  and  sixteen. 

SEC.  313.  (1)  That  if  an  injury  or  death  for  which  compensa- 
tion is  payable  under  this  article  is  caused  under  circumstances 
creating  a  legal  liability  upon  some  person  other  than  the  United 
States  or  the  enemy  to  pay  damages  therefor,  the  director,  as  a 
condition  to  payment  of  compensation  by  the  United  States,  may 
require  the  beneficiary  to  assign  to  the  United  States  any  right 
of  action  he  may  have  to  enforce  such  liability  of  such  other  per- 
son, or  if  it  appears  to  be  for  the  best  interests  of  the  beneficiary 
the  director  may  require  him  to  prosecute  the  said  action  in  his 
own  name,  subject  to  regulations.  The  director  may  require  such 
assignment  or  prosecution  at  any  time  after  the  injury  or  death, 
and  the  failure  on  the  part  of  the  beneficiary  to  so  assign  or  to 
prosecute  said  cause  of  action  in  his  own  name  within  a  reason- 
able time,  to  be  fixed  by  the  director,  shall  bar  any  right  to  com- 
pensation on  account  of  the  same  injury  or  death.  The  cause 
of  action  so  assigned  to  the  United  States  may  be  prosecuted  or 
compromised  by  the  director,  and  any  money  realized  or  collected 
thereon,  less  the  reasonable  expenses  of  such  realization  or  col- 
lection, shall  be  placed  to  the  credit  of  the  military  and  naval 
compensation  appropriation.  If  the  amount,  placed  to  the  credit 
of  such  appropriation  in  such  case  is  in  excess  of  the  amount 
of  the  award  of  compensation,  if  any,  such  excess  shall  be  paid 
to  the  beneficiary  after  any  compensation  award  for  the  same  in- 
jury or  death  is  made. 

If  a  beneficiary  or  conditional  beneficiary  shall  have  recovered, 
as  a  result  of  a  suit  brought  by  him  or  on  his  behalf,  or  as  a  re- 
sult of  a  settlement  made  by  him  or  on  his  behalf,  any  money 
or  other  property  in  satisfaction  of  the  liability  of  such  other 
person,  such  money  or  other  property  so  recovered  shall  be 
credited  upon  any  compensation  payable,  or  which  may  become 
payable,  to  such  beneficiary,  or  conditional  beneficiary  by  the 
United  States  on  account  of  the  same  injury  or  death. 

(2)  If  an  injury  or  death  for  which  compensation  may  be  pay- 
able under  this  article  is  caused  under  circumstances  creating 
a  legal  liability  upon  some  person,  other  than  the  United  States 
or  the  enemy,  to  pay  damages  therefor,  then,  in  order  to  preserve 
the  right  of  action,  the  director  may  require  the  conditional  bene- 
ficiary at  any  time  after  the  injury  or  death,  to  assign  such  right 
of  action  to  the  United  States,  or,  if  it  appears  to  be  for  the  best 
interests  of  such  conditional  beneficiary,  to  prosecute  the  said 
cause  of  action  in  his  own  name,  subject  to  regulations.  The 
failure  on  the  part  of  the  beneficiary  to  so  assign  or  to  prosecute 
the  said  cause  of  action  in  his  own  name  within  a  reasonable 
time,  to  be  fixed  by  the  director,  shall  bar  any  right  to  compensa- 
tion on  account  of  the  same  injury  or  death.  The  cause  of  action 
so  assigned  may  be  prosecuted  or  compromised  by  the  director, 
and  any  money  realized  or  collected  thereon,  less  the  reasonable 
expenses  of  such  realization  or  collection,  shall  be  paid  to  such 
beneficiary,  and  be  credited  upon  any  future  compensation  which 
may  become  payable  to  such  beneficiary  by  the  United  States 
on  account  of  the  same  injury  or  death. 

101 


(3)  The  bureau  shall  make  all  necessary  regulations  for  carry- 
ing out  the  purposes  of  this  section.  For  the  purpose  of  com- 
putation only  under  this  section  the  total  amount  of  compensa- 
tion due  any  beneficiary  shall  be  deemed  to  be  equivalent  to  a 
lump  sum  equal  to  the  present  value  of  all  future  payments  of 
compensation  computed  as  of  the  date  of  the  award  of  compen- 
sation at  four  per  centum,  true  discount,  compounded  annually. 
The  probability  of  the  beneficiary's  death  before  the  expiration 
of  the  period  during  which  he  is  entitled  to  compensation  shall 
be  determined  according  to  the  American  Experience  Table  of 
Mortality. 

A  conditional  beneficiary  is  any  person  who  may  become  en- 
titled to  compensation  under  this  article  on  or  after  the  death 
of  the  injured  person. 

Nothing  in  this  section  shall  be  construed  to  impose  any  ad- 
ministrative duties  upon  the  War  or  Navy  Departments. 

SEC.  314.  That  from  and  after  the  passage  of  this  Act  the  rate  of 
pension  for  a  widow  of  an  officer  or  enlisted  man  of  the  Army, 
Navy,  or  Marine  Corps  of  the  United  States  who  served  in  the 
Civil  War,  the  War  with  Spain,  or  the  Philippine  Insurrection, 
now  on  the  pension  roll  or  hereafter  to  be  placed  on  the  pension 
roll,  and  entitled  to  receive  a  less  rate  than  hereinafter  provided, 
shall  be  $25  per  month;  and  nothing  herein  shall  be  construed 
to  affect  the  additional  allowance  provided  by  existing  pension 
laws  on  account  of  a  helpless  child  or  child  under  sixteen  years 
of  age:  Provided,  however,  That  this  Act  shall  not  be  construed 
as  to  reduce  any  pension  under  any  Act,  public  or  private:  And 
provided  further,  That  the  provisions  of  this  section  shall  be 
administered,  executed,  and  enforced  by  the  Commissioner  of 
Pensions. 

ARTICLE  IV. 
INSURANCE. 

SEC.  400.  That  in  order  to  give  to  every  commissioned  officer 
and  enlisted  man  and  to  every  member  of  the  Army  Nurse  Corps 
(female)  and  of  the  Navy  Nurse  Corps  (female)  when  employed 
in  active  service  under  the  War  Department  or  Navy  Depart- 
ment greater  protection  for  themselves  and  their  dependents  than 
is  provided  in  Article  HI,  the  United  States,  upon  application 
to  the  bureau  and  without  medical  examination,  shall  grant  in- 
surance against  the  death  or  total  permanent  disability  of  any 
such  person  in  any  multiple  of  $500,  and  not  less  than  $1,000  or 
more  than  $10,000,  upon  the  payment  of  the  premiums  as  here- 
inafter provided. 

SEC.  401.  That  such  insurance  must  be  applied  for  within  one 
hundred  and  twenty  days  after  enlistment  or  after  entrance  into 
or  employment  in  the  active  service  and  before  discharge  or 
resignation,  except  that  those  persons  who  are  in  the  active  war 
service  at  the  time  of  the  publication  of  the  terms  and  conditions 
of  such  contract  of  insurance  may  apply  at  any  time  within 
one  hundred  and  twenty  days  thereafter  and  while  in  such  serv- 

102 


ice.  Any  person  in  the  active  service  on  or  after  the  sixth  day 
of  April,  nineteen  hundred  and  seventeen,  who,  while  in  such 
service  and  before  the  expiration  of  one  hundred  and  twenty 
days  from  and  after  such  publication,  becomes  or  has  become 
totally  and  permanently  disabled,  or  dies,  or  has  died,  without 
having  applied  for  insurance,  shall  be  deemed  to  have  applied 
for  and  to  have  been  granted  insurance,  payable  to  such  person 
during  his  life  in  monthly  installments  of  $25  each.  If  he  shall 
die  either  before  he  shall  have  received  any  of  such  monthly 
installments  or  before  he  shall  have  received  two  hundred  and 
forty  of  such  monthly  installments,  then  $25  per  month  shall  be 
paid  to  his  widow  from  the  time  of  his  death  and  during  her 
widowhood,  or  if  there  is  no  widow  surviving  him,  then  to  his 
child  or  children  or  if  there  is  no  child  surviving  him  then  to  his 
mother,  or  if  there  is  no  mother  surviving  him,  then  to  his 
father,  if  and  while  they  survive  him:  Provided,  however,  That 
not  nore  than  two  hundred  and  forty  of  such  monthly  install- 
ments, including  those  received  by  such  person  during  his  total 
and  permanent  disability,  shall  be  so  paid.  The  amount  of  the 
monthly  installments  shall  be  apportioned  between  children  as 
may  be  provided  by  regulations.1 

SEC.  402.  That  the  director,  subject  to  the  general  direction  of 
the  Secretary  of  the  Treasury,  shall  promptly  determine  upon  and 
publish  the  full  and  exact  terms  and  conditions  of  such  contract 
of  insurance.  The  insurance  shall  be  payable  only  to  a  spouse, 
child,  grandchild,  parent,  brother,  or  sister,  and  also  during  total 
and  permanent  disability  to  the  injured  person,  or  to  any  or  all 
of  them.  The  insurance  shall  be  payable  in  two  hundred  and 
forty  equal  monthly  installments.  Provisions  for  maturity  at  cer- 
tain ages,  for  continuous  installments  during  the  life  of  the  in- 
sured or  beneficiaries,  or  both,  for  cash,  loan,  paid  up  and  ex- 
tended values,  dividends  from  gains  and  savings,  and  such  other 
provisions  for  the  protection  and  advantage  of  and  for  alterna- 
tive benefits  to  the  insured  and  the  beneficiaries  as  may  be  found 
to  be  reasonable  and  practicable,  may  be  provided  for  in  the 
contract  of  insurance,  or  from  time  to  time  by  regulations.  All 
calculations  shall  be  based  upon  the  American  Experience  Table 
of  Mortality  and  interest  at  three  and  one-half  per  centum  per 
annum,  except  that  no  deduction  shall  be  made  for  continuous 
installments  during  the  life  of  the  insured  in  case  his  total  and 
permanent  disability  continues  more  than  two  hundred  and  forty 
months.  Subject  to  regulations,  the  insured  shall  at  all  times  have 
the  right  to  change  the  beneficiary  or  beneficiaries  of  such  in- 
surance without  the  consent  of  such  beneficiary  or  beneficiaries, 
but  only  within  the  classes  herein  provided.  If  no  beneficiary 
within  the  permitted  class  be  designated  by  the  insured,  either 

1  Section  401,  as  amended,  is  in  effect  as  of  October  6,  1917:  Provided,  That 
nothing  herein  shall  be  construed  to  interfere  with  the  payment  of  monthly 
Installments,  authorized  to  be  made  under  the  provisions  of  said  section  401 
as  originally  enacted,  for  the  months  up  to  and  including  June,  1918:  Provided 
further.  That  all  awards  of  automatic  insurance  under  the  provisions  of  said 
section  401  as  originally  enacted  shall  be  revised  as  of  the  first  day  of  July, 
1918,  in  accordance  with  the  provision  of  said  section  401  as  amended.  (Ex- 
tract from  section  20  of  Act  of  June  25,  1918.) 

103 


nated  beneficiary  does  not  survive  the  insured,  the  insurance 
in  his  lifetime  or  by  his  last  will  and  testament,  of  if  the  desig- 
shall  be  payable  to  such  person  or  persons  within  the  permitted 
class  of  beneficiaries  as  would  under  the  laws  of  the  State  of  the 
residence  of  the  insured  be  entitled  to  his  personal  property  in 
case  of  intestacy.  If  no  such  person  survive  the  insured,  then 
there  shall  be  paid  to  the  estate  of  the  insured  an  amount  equal 
to  the  reserve  value,  if  any,  of  the  insurance  at  the  time  of  his 
death,  calculated  on  the  basis  of  the  American  Experience  Table 
of  Mortality  and  three  and  one-half  per  centum  interest  in  full 
of  all  obligations  under  the  contract  of  insurance. 

SEC.  403.  That  the  United  States  shall  bear  the  expenses  of  ad- 
ministration and  the  excess  mortality  and  disability  cost  resulting 
from  the  hazards  of  war.  The  premium  rates  shall  be  the  net 
rates  based  upon  the  American  Experience  Table  of  Mortality 
and  interest  at  three  and  one-half  per  centum  per  annum. 

SEC.  404.  That  during  the  period  of  war  and  thereafter  until 
converted  the  insurance  shall  be  term  insurance  for  successive 
terms  of  one  year  each.  Not  later  than  five  years  after  the  date 
of  the  termination  of  the  war  as  declared  by  proclamation  of  the 
President  of  the  United  States,  the  term  insurance  shall  be  con- 
verted, without  medical  examination,  into  such  form  or  forms 
of  insurance  as  may  be  prescribed  by  regulations  and  as  the  in- 
sured may  request.  Regulations  shall  provide  for  the  right  to 
convert  into  ordinary  life,  twenty-payment  life,  endowment  ma- 
turing at  age  sixty-two  and  into  other  usual  forms  of  insurance 
and  shall  prescribe  the  time  and  method  of  payment  of  the  pre- 
miums thereon,  but  payments  of  premiums  in  advance  shall  not 
be  required  for  periods  of  more  than  one  month  each  and  may 
be  deducted  from  the  pay  or  deposit  of  the  insured  or  be  other- 
wise made  at  his  election. 

SEC.  405.  [This  section  was  repealed  by  act  of  May  20,  1918. 
The  substance  is  now  included  in  Section  13.] 

[PUBLIC — No.  104 — 66TH  CONGRESS.] 

[H.  R.  8778] 
An  Act  To  amend  and  modify  the  War  Risk  Insurance  Act. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of 
the  United  States  of  America  in  Congress  assembled,  That  thte 
office  of  the  Commissioner  of  Military  and  Naval  Insurance  and 
the  office  of  the  Commissioner  of  Marine  and  Seamen's  Insur- 
ance created  by  the  War  Risk  Insurance  Act  are  hereby  abolished 
and  the  powers  and  duties  pertaining  to  such  offices  are  hereby 
transferred  to  the  Director  of  the  Bureau  of  War  Risk  Insurance, 
who  shall  hereafter  receive  a  salary  at  the  rate  of  $7,500  per 
annum.  Until  such  time  as  the  Secretary  of  the  Treasury  may 
direct  otherwise,  and  subject  to  the  provisions  of  section  9  of 
the  War  Risk  Insurance  Act,  there  shall  be  in  the  Bureau  of  War 
Risk  Insurance  a  Division  of  Marine  and  Seamen's  Insurance 
and  a  Division  of  Military  and  Naval  Insurance.  All  laws  incon- 
sistent with  this  section  are  hereby  so  modified  as  to  conform  to 
the  provisions  hereof. 

104 


SEC.  2.  That  paragraph  (b)  of  the  second  subdivision  (1)  of 
section  22  of  the  War  Risk  Insurance  Act  is  hereby  amended  to 
read  as  follows: 

"(b)  A  child  legally  adopted." 

SEC.  3.  That  paragraph  (d)  of  the  second  subdivision  (1)  of 
section  22  of  the  War  Risk  Insurance  Act  is  hereby  amended  to 
read  as  follows: 

"(d)  An  illegitimate  child,  but,  as  to  the  father  only,  if  ac- 
knowledged in  writing  signed  by  him,  or  if  he  has  been  judicially 
ordered  or  decreed  to  contribute  to  such  child's  support,  or  has 
been  judicially  decreed  to  be  the  putative  father  of  such  child." 

SEC.  4.  That  section  22  of  the  War  Risk  Insurance  Act  is  hereby 
amended  by  inserting  therein  immediately  following  subdivisions 
(4)  and  (5),  respectively,  two  new  subdivisions  to  be  known 
as  subdivision  (4a)  and  subdivision  (5a)  and  to  read  as  follows: 

"(4a)  The  terms  'father*  and  'mother*  include  stepfathers  and 
stepmothers,  fathers  and  mothers  through  adoption,  and  persons 
who  have  stood  in  loco  parentis  to  a  member  of  the  military 
or  naval  forces  at  any  time  prior  to  his  enlistment  or  induction 
for  a  period  of  not  less  than  one  year:  Provided,  That  this  sub- 
division shall  be  deemed  to  be  in  effect  as  of  October  6,  1917." 

"(5a)  The  terms  'brother'  and  'sister*  include  the  children  of 
a  person  who,  for  a  period  of  not  less  than  one  year,  stood  in 
loco  parentis  to  a  member  of  the  military  or  naval  forces  of  the 
United  States  at  any  time  prior  to  his  enlistment  or  induction,  or 
another  member  of  the  same  household  as  to  whom  such  person 
during  such  period  likewise  stood  in  loco  parentis:  Provided, 
That  this  subdivision  shall  be  deemed  to  be  in  effect  as  of  October 
6,  1917." 

SEC.  5.  That  section  23  of  the  War  Risk  Insurance  Act  is  hereby 
amended  by  the  edition  thereto  of  a  new  paragraph  to  read  as 
follows : 

"If  any  person  entitled  to  receive  payments  under  this  Act 
shall  be  an  inmate  of  any  asylum  or  hospital  for  the  insane  main- 
tained by  the  United  States,  or  by  any  of  the  several  States  or 
Territories  of  the  United  States,  or  any  political  subdivision 
thereof,  and  no  guardian  or  curator  of  the  property  of  such  per- 
son shall  have  been  appointed  by  competent  legal  authority,  the 
director,  if  satisfied  after  due  investigation  that  any  such  person  is 
mentally  incompentent,  may  order  that  all  moneys  payable  to 
him  or  her  under  this  Act  shall  be  held  in  the  Treasury  of  the 
United  States  to  the  credit  of  such  person.  All  funds  so  held  shall 
be  disbursed  under  the  order  of  the  director  and  subject  to  his 
discretion,  either  to  the  chief  executive  officer  of  the  asylum 
or  hospital  in  which  such  person  is  an  inmate,  or  to  be  used 
by  such  officer  for  the  maintenance  and  comfort  of  such  inmate, 
subject  to  the  duty  to  account  to  the  Bureau  of  War  Risk  Insur- 
ance and  to  repay  any  surplus  at  any  time  remaining  in  his  hands 
in  accordance  with  regulations  to  be  prescribed  by  the  director; 
or  to  the  wife  (or  dependent  husband  if  the  inmate  is  a  woman), 
minor  children,  and  dependent  parents  of  such  inmate,  in  such 
amounts  as  the  director  shall  find  necessary  for  their  support 
and  maintenance,  in  the  order  named;  or,  if  at  any  time  such 

105 


inmate  shall  be  found  to  be  mentally  competent,  or  shall  die, 
or  a  guardian  or  curator  of  his  or  her  estate  be  appointed,  any 
balance  remaining  to  the  credit  of  such  inmate  shall  be  paid  to 
such  inmate,  if  mentally  competent,  and  otherwise  to  his  or  her 
guardian,  curator  or  personal  representatives." 

SEC.  6.  That  the  provisions  of  section  28  of  the  War  Risk 
Insurance  Act  shall  not  be  construed  to  prohibit  the  assignment 
by  any  person  to  whom  converted  insurance  shall  be  payable 
under  Article  IV  of  such  Act  of  his  interest  in  such  insurance  to 
any  other  member  of  the  permitted  class  of  beneficiaries. 

SEC.  7.  That  a  new  section  is  hereby  added  to  the  War  Risk 
Insurance  Act,  to  be  known  as  section  31,  and  to  read  as  follows: 

"SEC.  31.  That  if  after  induction  by  the  local  draft  board,  but 
before  being  accepted  and  enrolled  for  active  service,  the  person 
died  or  became  disabled  as  a  result  of  disease  contracted  or 
injury  suffered  in  the  line  of  duty  and  not  due  to  his  own  will- 
ful misconduct  involving  moral  turpitude,  or  as  a  result  of  the 
aggravation,  in  the  line  of  duty  and  not  because  of  his  own  will- 
ful misconduct  involving  moral  turpitude,  of  an  existing  disease 
or  injury,  he  or  those  entitled  thereto  shall  receive  the  benefits  of 
compensation  payable  under  Article  III.  Provided,  That  any  in- 
surance application  made  by  a  person  after  induction  by  the 
local  draft  board  but  before  being  accepted  and  enrolled  for 
active  service  shall  be  deemed  valid." 

SEC.  8.  That  the  second  paragraph  of  section  204  of  the  War 
Risk  Insurance  Act  is  hereby  amended  to  read  as  follows: 

"The  family  allowance  shall  be  paid  from  the  time  of  enlist- 
ment to  death  in  or  one  month  after  discharge  from  the  service, 
but  not  for  more  than  four  months  after  the  termination  of  the 
present  war  emergency.  No  family  allowance  shall  be  made 
for  any  period  preceding  November  1,  1917.  The  payment  shall 
be  subject  to  such  regulations  as  may  be  prescribed  relative  to 
cases  of  desertion  and  imprisonment  and  of  missing  men." 

SEC.  9.  That  a  new  section  is  hereby  added  to  Article  II  of  the 
War  Risk  Insurance  Act,  to  be  known  as  section  211,  and  to  read 
as  follows: 

"SEC.  211.  That  all  family  allowances  and  allotments  payable 
by  the  Bureau  of  War  Risk  Insurance  under  the  authority  of  this 
article  shall  be  discontinued  at  the  end  of  the  fourth  calendar 
month  after  the  termination  of  the  present  war  emergency,  as 
declared  by  proclamation  of  the  President  of  the  United  States, 
and  thereafter  all  allotments  of  pay  shall  be  voluntary  and  shall 
be  made  under  such  regulations  as  may  be  prescribed  by  the 
Secretary  of  War  and  the  Secretary  of  the  Navy,  respectively." 

SEC.  10,  That  the  second  paragraph  of  subdivision  (g)  of  sec- 
tion 301  of  the  War  Risk  Insurance  Act  is  hereby  amended  to 
read  as  follows: 

"If  the  death  occur  or  shall  have  occurred  subsequent  to  April 
6,  1917,  and  before  discharge  or  resignation  from  service,  the 
United  States  shall  pay  for  burial  expenses  and  return  of  body 
to  his  home  a  sum  not  to  exceed  $100,  as  may  be  fixed  by  regula- 
tions." 

That  section  301  of  the  War  Risk  Insurance  Act,  as  amended, 

106 


shall  be  deemed  to  be  in  effect  as  of  April  6,  1917:  Provided, 
however,  That  before  compensation  thereunder  shall  be  paid 
there  shall  first  be  deducted  from  said  sum  so  to  be  paid  the 
amount  of  any  payments  such  person  may  have  received  by  way 
of  gratuities  or  payments  under  pension  laws  in  force  and  ex- 
istence between  April  6,  1917,  and  October  6,  1917. 

SEC.  lOa.  That  section  300  of  the  War  Risk  Insurance  Act  is 
hereby  amended  to  read  as  follows: 

"SEC.  300.  That  for  death  or  disability  resulting  from  personal 
injury  suffered  or  disease  contracted  in  the  line  of  duty,  by  any 
commissioned  officer  or  enlisted  man,  or  by  any  member  of  the 
Army  Nurse  Corps  (female)  or  of  the  Navy  Nurse  Corps  (female) 
when  employed  in  the  active  service  under  the  War  Department 
or  Navy  Department,  the  United  States  shall  pay  compensation 
as  hereinafter  provided;  but  no  compensation  shall  be  paid  if 
the  injury  or  disease  has  been  caused  by  his  own  willful  miscon- 
duct: Provided,  That  for  the  purposes  of  this  section  said  officer, 
enlisted  man,  or  other  member  shall  be  held  and  taken  to  have 
been  in  sound  condition  when  examined,  accepted,  and  enrolled 
for  service :  Provided  further,  That  this  section,  as  amended,  shall 
be  deemed  to  become  effective  as  of  April  6,  1917." 

SEC.  11.  That  section  302  of  the  War  Risk  Insurance  Act  is 
hereby  amended  to  read  as  follows: 

"SEC.  302.  That  if  disability  results  from  the  injury— 

"(1)  If  and  while  the  disability  is  rated  as  total  and  temporary, 
the  monthly  compensation  shall  be  the  following  amounts: 

"(a)  If  the  disabled  person  has  neither  wife  nor  child  living, 
$80. 

"(b)  If  he  has  a  wife  but  no  child  living,  $90. 

"(c)  If  he  has  a  wife  and  one  child  living,  $95. 

"(d)  If  he  has  a  wife  and  two  or  more  children  living,  $100. 

"(e)  If  he  has  no  wife  but  one  child  living,  $90,  with  $5  for 
each  additional  child. 

"(f)  If  he  has  a  mother  or  father,  either  or  both  dependent  on 
him  for  support,  then,  in  addition  to  the  above  amounts,  $10  for 
each  parent  so  dependent. 

"(2)  If  and  while  the  disability  is  rated  as  partial  and  tem- 
porary, the  monthly  compensation  shall  be  a  percentage  of  the 
compensation  that  would  be  payable  for  his  total  and  temporary 
disability,  equal  to  the  degree  of  the  reduction  in  earning  capacity 
resulting  from  the  disability,  but  no  compensation  shall  be  pay- 
able for  a  reduction  in  earning  capacity  rated  at  less  than  10 
per  centum. 

"(3)  If  and  while  the  disability  is  rated  as  total  and  perma- 
nent, the  rate  of  compensation  shall  be  $100  per  month:  Provided, 
however,  That  the  loss  of  both  feet,  or  both  hands,  or  the  sight 
of  both  eyes,  or  the  loss  of  one  foot  and  one  hand,  or  one  foot 
and  the  sight  of  one  eye,  or  one  hand  and  the  sight  of  one  eye, 
or  becoming  helpless  and  permanently  bedridden,  shall  be  deemed 
to  be  total,  permanent  disability:  Provided  further,  That  for 
double,  total,  permanent  disability  the  rate  of  compensation  shall 
be  $200  per  month. 

"(4)  If  and  while  the  disability  is  rated  as  partial  and  perman- 

107 


nent,  the  monthly  compensation  shall  be  a  percentage  of  the 
compensation  that  would  be  payable  for  his  total  and  permanent 
disability  equal  to  the  degree  of  the  reduction  in  earning  capacity 
resulting  from  the  disability,  but  no  compensation  shall  be  pay- 
able for  a  reduction  in  earning  capacity  rated  at  less  than  10 
per  centum. 

"A  schedule  of  ratings  of  reductions  in  earning  capacity  from 
specific  injuries  or  combinations  of  injuries  of  a  permanent  na- 
ture shall  be  adopted  and  applied  by  the  bureau.  Ratings  may 
be  as  high  as  100  per  centum.  The  ratings  shall  be  based,  as  far 
as  practicable,  upon  the  average  impairments  of  earning  capacity 
resulting  from  such  injuries  in  civil  occupations  and  not  upon 
the  impairment  in  earning  capacity  in  each  individual  case,  so 
that  there  shall  be  no  reduction  in  the  rate  of  compensation  for 
individual  success  in  overcoming  the  handicap  of  a  permanent 
injury.  The  bureau  in  adopting  the  schedule  of  ratings  of  reduc- 
tion in  earning  capacity  shall  consider  the  impairment  in  ability 
to  secure  employment  which  results  from  such  injuries.  The 
bureau  shall  from  time  to  time  readjust  this  schedule  of  ratings 
in  accordance  with  actual  experience. 

"(5)  If  the  disabled  person  is  so  helpless  as  to  be  in  constant 
need  of  a  nurse  or  attendant,  such  additional  sum  shall  be  paid, 
but  not  exceeding  $20  per  month,  as  the  director  may  deem 
reasonable. 

"(6)  In  addition  to  the  compensation  above  provided,  the  in- 
jured person  shall  be  furnished  by  the  United  States  such  reason- 
able governmental  medical,  surgical,  and  hospital  services  and 
with  such  supplies,  including  wheeled  chairs,  artificial  limbs, 
trusses,  and  similar  appliances,  as  the  director  may  determine 
to  be  useful  and  reasonably  necessary,  which  wheeled  chairs, 
artificial  limbs,  trusses,  and  similar  appliances  may  be  procured 
by  the  Bureau  of  War  Risk  Insurance  in  such  manner,  either  by 
purchase  or  manufacture,  as  the  director  may  determine  to  be 
advantageous  and  reasonably  necessary:  Provided,  That  nothing 
in  this  Act  shall  be  construed  to  affect  the  necessary  military 
control  over  any  member  of  the  military  or  naval  establishments 
before  he  shall  have  been  discharged  from  the  military  or  naval 
service. 

"(7)  Where  the  disabled  person  and  his  wife  are  not  living 
together,  or  where  the  children  are  not  in  the  custody  of  the 
disabled  person  the  amount  of  the  compensation  shall  be  appor- 
tioned as  may  be  prescribed  by  regulations. 

"(8)  The  term  'wife*  as  used  in  this  section  shall  include  'hus- 
band* if  the  husband  is  dependent  upon  the  wife  for  support. 

"(9)  That  the  Bureau  of  War  Risk  Insurance  is  hereby  author- 
ized to  furnish  transportation,  also  the  medical,  surgical,  and  hos- 
pital services  and  the  supplies  and  appliances  provided  by  sub- 
division (6)  hereof,  to  discharged  members  of  the  military  or 
naval  forces  of  those  Governments  which  have  been  associated 
in  war  with  the  United  States  since  April  6,  1917,  and  come  within 
the  provisions  of  laws  of  such  Governments  similar  to  the  Wai- 
Risk  Insurance  Act,  at  such  rates  and  under  such  regulations 
as  the  Director  of  the  Bureau  of  War  Risk  Insurance  may  pre- 
108 


scribe;  and  the  Bureau  of  War  Risk  Insurance  is  hereby  author- 
ized to  utilize  the  similar  services,  supplies,  and  appliances  pro- 
vided for  the  discharged  members  of  the  military  and  naval  forces 
of  those  Governments  which  have  been  associated  in  war  with 
the  United  States  since  April  6,  1917,  by  the  laws  of  such  Govern- 
ments similar  to  the  War  Risk  Insurance  Act,  in  furnishing  the 
discharged  members  of  the  military  and  naval  forces  of  the 
United  States  who  live  within  the  territorial  limits  of  such  Gov- 
ernments and  come  within  the  provisions  of  subdivision  (6) 
hereof,  with  the  services,  supplies,  and  appliances  provided  for 
in  such  subdivision;  and  any  appropriations  that  have  been  or 
may  hereafter  be  made  for  the  purpose  of  furnishing  the  services, 
supplies,  and  appliances  provided  for  by  subdivision  (6)  hereof 
are  hereby  made  available  for  the  payment  to  such  Governments 
or  their  agencies  for  the  services,  supplies,  and  appliances  so 
furnished  at  such  rates  and  under  such  regulations  as  the  Director 
of  the  Bureau  of  War  Risk  Insurance  may  prescribe. 

"(10)  That  section  302  of  the  War  Risk  Insurance  Act  as 
amended  shall  be  deemed  to  be  in  effect  as  of  April  6,  1917:  Pro- 
vided,  That  any  person  who  is  now  receiving  a  gratuity  or  pen- 
sion under  existing  law  shall  not  receive  compensation  under  this 
Act  unless  he  shall  first  surrender  all  claim  to  such  gratuity  or 
pension." 

SEC.  12.  That  section  401  of  the  War  Risk  Insurance  Act  is 
hereby  amended  to  read  as  follows: 

"SEC.  401.  That  such  insurance  must  be  applied  for  within 
one  hundred  and  twenty  days  after  enlistment  or  after  entrance 
into  or  employment  in  the  active  service  and  before  discharge 
or  resignation,  except  that  those  persons  who  are  in  the  active 
war  service  at  the  time  of  the  publication  of  the  terms  and  con- 
ditions of  such  contract  of  insurance  may  apply  at  any  time 
within  one  hundred  and  twenty  days  thereafter  and  while  in 
such  service:  Provided,  That  any  person  in  the  active  service 
on  or  after  the  6th  day  of  April,  1917,  and  before  the  llth  day  of 
November,  1918,  who  while  in  such  active  service  made  applica- 
tion for  insurance  after  the  expiration  of  more  than  one  hundred 
and  twenty  days  after  October  15,  1917,  or  more  than  one  hundred 
and  twenty  days  after  entrance  into  or  employment  in  the 
active  service,  and  whose  application  was  accepted  and  a  policy 
issued  thereon,  and  from  whom  premiums  were  collected,  and 
who  becomes  or  had  become  totally  and  permanently  disabled,  or 
dies  or  has  died,  shall  be  deemed  to  have  made  legal  application 
for  such  insurance  and  the  policy  issued  on  such  application  shall 
be  valid.  Any  person  in  the  active  service  on  or  after  the  6th 
day  of  April,  1917,  and  before  the  llth  day  of  November,  1918, 
who  while  in  such  service,  and  before  the  expiration  of  one  hun- 
dred and  twenty  days  after  October  15,  1917,  or  one  hundred 
and  twenty  days  after  entrance  into  or  employment  in  the  active 
service,  becomes  or  has  become  totally  and  permanently  dis- 
abled, or  dies  or  has  died,  without  having  applied  for  insurance, 
shall  be  deemed  to  have  applied  for  and  to  have  been  granted  in- 
surance, payable  to  such  person  during  his  life  in  monthly  in- 
stallments of  $25  each;  and  any  person  inducted  into  the  service 

109 


by  a  local  draft  board  after  the  6th  day  of  April,  1917,  and  be- 
fore the  llth  day  of  November,  1918,  who,  while  in  such  service, 
and  before  being  accepted  and  enrolled  for  active  military  or 
naval  service,  becomes  or  has  become  totally  and  permanently 
disabled,  or  dies  or  has  died,  without  having  applied  for  insur- 
ance, shall  be  deemed  to  have  applied  for  and  to  have  been 
granted  insurance,  payable  to  such  person  during  his  life  in 
monthly  installments  of  $25  each.  If  he  shall  die  either  before 
he  shall  have  received  any  of  such  monthly  installments  or  before 
he  shall  have  received  two  hundred  and  forty  of  such  monthly 
installments,  then  $25  per  month  shall  be  paid  to  his  widow 
from  the  time  of  his  death  and  during  her  widowhood;  or  if 
there  is  no  widow  surviving  him,  then  to  his  child  or  children; 
of  if  there  is  no  child  surviving  him,  then  to  his  mother;  of  if 
there  be  no  mother  surviving  him,  then  to  his  father,  if  and 
while  they  survive  him:  Provided,  however,  That  no  more  than 
two  hundred  and  forty  of  such  monthly  installments,  including 
those  received  by  such  person  during  his  total  and  permanent 
disability,  shall  be  so  paid.  The  amount  of  the  monthly  install- 
ments shall  be  apportionel  between  children  as  may  be  provided 
by  regulations:  Provided  further,  That  each  officer  and  enlisted 
man  attached  to  the  United  States  ship  "Cyclops"  on  the  4th  day 
of  March,  1918,  and  every  officer  and  enlisted  man  who  on  said 
date  was  a  passenger  on  said  vessel  shall  be  deemed  to  have 
been  granted  insurance  in  the  sum  of  $5,000  permitted  under 
the  War  Risk  Insurance  Act." 

SEC.  13.  That  the  permitted  class  of  beneficiaries  for  insurance 
as  specified  in  section  402  of  the  War  Risk  Insurance  Act  is  hereby 
enlarged  so  as  to  include,  in  addition  to  the  persons  therein 
enumerated,  uncles,  aunts,  nephews,  nieces,  brothers-in-law  and 
sisters-in-law  of  the  insured.  This  section  shall  be  deemed  to 
be  in  effect  as  of  October  6,  1917:  Provided,  That  nothing  herein 
shall  be  construed  to  interfere  with  the  payment  of  the  monthly 
installments  authorized  to  be  made  under  the  provisions  of  said 
War  Risk  Insurance  Act,  as  originally  enacted  and  subsequently 
amended,  up  to  and  including  the  second  calendar  month  after 
the  passage  of  this  Act:  Provided  further,  That  all  awards  of 
Insurance  under  the  provisions  of  the  said  War  Risk  Insurance 
Act,  as  originally  enacted  and  subsequently  amended,  shall  be  re- 
vised as  of  the  first  day  of  the  third  calendar  month  after  the 
passage  of  this  Act,  in  accordance  with  the  provisions  of  the  said 
War  Risk  Insurance  Act  as  modified  by  this  amendatory  Act. 

SEC.  14.  That  if  no  person  within  the  permitted  class  of  bene- 
ficiaries survive  the  insured,  then  there  shall  be  paid  to  the  es- 
tate of  the  insured  the  monthly  installments  payable  and  appli- 
cable under  the  provisions  of  Article  IV  of  the  War  Risk  In- 
surance Act. 

SEC.  15.  That  if  any  person  to  whom  such  yearly  renewable 
term  insurance  has  been  awarded  dies,  or  his  rights  are  other- 
wise terminated  after  the  death  of  the  insured,  but  before  all  of 
the  two  hundred  and  forty  monthly  installments  have  been  paid, 
then  the  monthly  installments  payable  and  applicable  shall  be 
payable  to  such  person  or  persons  within  the  permitted  class 

110 


of  beneficiaries  as  would,  under  the  laws  of  the  State  of  residence 
of  the  insured,  be  entitled  to  his  personal  property  in  case  of 
intestacy;  and  if  the  permitted  class  of  beneficiaries  be  exhausted 
before  all  of  the  two  hundred  and  forty  monthly  installments 
have  been  paid,  then  there  shall  be  paid  to  the  estate  of  the  last 
surviving  person  within  the  permitted  class  the  remaining  un- 
paid monthly  installments. 

SEC.  16.  That  if  no  beneficiary  within  the  permitted  class  be 
designated  by  the  insured  as  beneficiary  for  converted  insurance, 
granted  under  the  provisions  of  Article  IV  of  the  War  Risk  Insur- 
ance Act  either  in  his  lifetime  or  by  his  last  will  and  testament, 
or  if  the  designated  beneficiary  does  not  survive  the  insured, 
then  there  shall  be  paid  to  the  estate  of  the  insured  the  remain- 
ing unpaid  monthly  installments;  or  if  the  designated  beneficiary 
survives  the  insured  and  dies  before  receiving  all  of  the  install- 
ments of  converted  insurance  payable  and  applicable,  then  there 
shall  be  paid  to  the  estate  of  such  beneficiary  the  remaining  un- 
paid monthly  installments. 

SEC.  17.  That  the  Bureau  of  War  Risk  Insurance  may  make 
provision  in  the  contract  for  converted  insurance  for  optional 
settlements,  to  be  selected  by  the  insured,  whereby  such  insur- 
ance may  be  made  payable  either  in  one  sum  or  in  installments  for 
thirty-six  months  or  more.  The  bureau  may  also  include  in  said 
contract  a  provision  authorizing  the  beneficiary  to  elect  to  re- 
ceive payment  of  the  insurance  in  installments  for  thirty-six 
months  or  more,  but  only  if  the  insured  has  not  exercised  the 
right  of  election  as  hereinbefore  provided;  and  even  though  the 
insured  may  have  exercised  his  right  of  election  the  said  contract 
may  authorize  the  beneficiary  to  elect  to  receive  such  insurance 
in  installments  spread  over  a  greater  period  of  time  than  that 
selected  by  the  insured. 

SEC.  18.  That  all  premiums  paid  on  account  of  insurance  con- 
verted under  the  provisions  of  Article  IV  of  the  War  Risk  In- 
surance Act  shall  be  deposited  and  covered  into  the  Treasury  to 
the  credit  of  the  United  States  Government  life  insurance  fund 
and  shall  be  available  for  the  payment  of  losses,  dividends,  re- 
funds, and  other  benefits  provided  for  under  such  insurance. 
Payments  from  this  fund  shall  be  made  upon  and  in  accordance 
with  awards  by  the  director. 

The  Bureau  of  War  Risk  Insurance  is  hereby  authorized  to 
set  aside  out  of  the  fund  so  collected  such  reserve  funds  as  may 
be  required,  under  accepted  actuarial  principles,  to  meet  all 
liabilities  under  such  insurance;  and  the  Secretary  of  the  Treas- 
ury is  hereby  authorized  to  invest  and  reinvest  the  said  United 
States  Government  life  insurance  fund,  or  any  part  thereof,  in 
interest-bearing  obligations  of  the  United  States  and  to  sell  the 
obligations  for  the  purposes  of  the  said  fund. 

SEC.  19.  That  the  amount  of  the  monthly  installments  of  allot- 
ment and  family  allowance,  compensation,  or  yearly  renewable 
term  insurance  which  has  become  payable  under  the  provisions 
of  the  War  Risk  Insurance  Act  but  which  has  not  been  paid  prior 


111 


to  the  death  of  the  person  entitled  to  receive  the  same  may  be 
payable  to  the  personal  representatives  of  the  deceased  person. 
Approved,  December  24,  1919. 

[PUBLIC — No.  326— 65xn  CONGRESS.] 

[H.   R.   13026] 

An  Act  To  authorize  the  Secretary  of  the  Treasury  to  provide  hospital  and 
sanatorium  facilities  for  discharged  sick  and  disabled  soldiers,  sailors,  and 
marines. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  -States  of  America  in  Congress  Assembled,  That  the  secre- 
tary of  the  Treasury  be,  and  he  is  hereby,  authorized  to  provide 
immediate  additional  hospital  and  sanatorium  facilities  for  the 
care  and  treatment  of  discharged  sick  and  disabled  soldiers, 
sailors,  and  marines,  Army  and  Navy  nurses  (male  and  female), 
patients  of  the  War  Risk  Insurance  Bureau,  and  the  following 
persons  only:  Merchant  Marine  seamen,  seamen  on  boats  of  the 
Mississippi  River  Commission,  officers  and  enlisted  men  of  the 
United  States  Coast  Guard,  officers  and  employees  of  the  Public 
Health  Service,  certain  keepers  and  assistant  keepers  of  the 
United  States  Lighthouse  Service,  seamen  of  the  Engineer  Corps 
of  the  United  States  Army,  officers  and  enlisted  man  of  the  United 
States  Coast  and  Geodetic  Survey,  civilian  employees  entitled 
to  treatment  under  the  United  States  Employees'  Compensation 
Act,  and  employees  on  Army  transports  not  officers  or  enlisted 
men  of  the  Army,  now  entitled  by  law  to  treatment  by  the  Public 
Health  Service. 

SEC.  2.  There  are  hereby  permanently  transferred  to  the  Treas- 
ury Department  for  the  use  of  the  Public  Health  Service  for 
hospital  or  sanatoria  or  other  uses  the  following  properties,  with 
their  present  equipment,  including  sites  and  leases,  or  so  much 
thereof  as  may  be  required  by  the  Public  Health  Service,  includ- 
ing mechanical  equipment  in  connection  therewith,  and  ap- 
proaches thereto,  with  authority  to  lease  or  purchase  sites  not 
owned  by  the  Government,  as  follows:  Hospitals,  with  such  other 
buildings  and  land  as  may  be  required,  at  Camp  Cody  (New 
Mexico),  Camp  Hancock  (Georgia),  Camp  Joseph  E.  Johnston 
(Florida),  Camp  Beauregard  (Louisiana),  Camp  Logan  (Texas), 
Camp  Fremont  (California),  and  nitrate  plant  Perryville  (Mary- 
land), and  such  hospitals,  with  other  necessary  buildings,  here- 
after vacated  by  the  War  Department,  as  may  be  required  and 
found  suitable  for  the  needs  of  the  Public  Health  Service  for 
hospital  and  sanatoria  purposes.  And  for  the  purpose  of  such 
remodeling  of  or  additions  to  the  above-named  plants  as  may  be 
required  to  adapt  them  to  the  needs  and  uses  of  the  Public  Health 
Service,  the  sum  of  $750,000  is  hereby  authorized. 

SEC.  3.  The  Secretary  of  War  is  hereby  authorized  and  directed 
to  transfer  without  charge  to  the  Secretary  of  the  Treasury  for 
the  use  of  the  Public  Health  Service  such  hospital  furniture  and 
equipment,  including  hospital  and  medical  supplies,  motor  trucks, 
and  other  motor-driven  vehicles,  in  good  condition,  not  required 

112 


by  the  War  Department,  as  may  be  required  by  the  Public  Health 
Service  for  its  hospitals,  and  the  President  is  authorized  to  direct 
the  transfer  to  the  Treasury  Department  of  the  use  of  such  lands 
or  parts  of  lands,  buildings,  fixtures,  appliances,  furnishings,  or 
furniture  under  the  control  of  any  department  of  the  Govern- 
ment not  required  for  the  purposes  of  such  department  and  suit- 
able for  the  uses  of  the  Public  Health  Service. 

SEC.  4.  So  much  of  the  Battle  Mountain  Sanatorium  at  Hot 
Springs,  South  Dakota,  the  National  Home  for  Disabled  Volunteer 
Soldiers,  with  its  present  equipment,  as  is  not  required  for  the 
purposes  for  which  these  facilities  were  provided,  is  hereby  made 
available  for  the  use  of  the  Public  Health  Service  for  a  period  of 
five  years  from  the  approval  of  this  Act,  unless  sooner  released 
by  the  Surgeon  General  of  the  Public  Health  Service. 

SEC.  5.  The  Secretary  of  the  Treasury  is  hereby  authorized  to 
contract  with  any  existing  hospital  or  sanatorium,  by  lease  or 
otherwise,  for  immediate  use,  in  whole  or  in  part,  of  their  present 
facilities,  so  as  to  provide  bed  capacity  and  facilities  for  not  ex- 
ceeding one  thousand  patients,  and  for  such  purposes  the  sum 
of  $300,000  is  hereby  authorized. 

SEC.  6.  The  Secretary  of  the  Treasury  is  hereby  authorized,  if 
in  his  judgment  the  same  will  be  for  the  best  interests  of  the 
Government  from  the  standpoint  of  cost,  location,  and  of  the 
emergency  needs  of  the  Public  Health  Service,  to  purchase  the 
site,  buildings,  and  hospital  facilities  and  appurtenances,  at  Cor- 
pus Ghristi,  Texas,  known  as  General  Hospital  Numbered  15, 
and  for  such  purpose  the  sum  of  $150,000  is  hereby  authorized. 

The  sum  of  $1,500,000  is  hereby  authorized  to  be  held  as  an 
emergency  fund  for  the  purchase  of  land  and  buildings  suitable 
for  hospital  and  sanatoria  purposes,  which  the  Secretary  of  the 
Treasury  is  hereby  authorized  to  select  and  locate,  and  to  make 
additions  and  improvements  suitable  to  adapt  them  to  the  uses 
of  the  United  States  Public  Health  Service,  if  in  his  judgment 
the  emergency  requires  it. 

SEC.  7.  By  the  construction  of  new  hospitals  and  sanatoria,  to 
include  the  necessary  buildings  with  their  appropriate  mechani- 
cal and  other  equipment  and  approach  work,  including  roads, 
leading  thereto,  for  the  accommodation  of  patients,  officers, 
nurses,  attendants,  storage,  laundries,  vehicles,  and  live  stock  on 
sites  now  owned  by  the  Government,  or  on  new  sites  to  be  ac- 
quired by  purchase  or  otherwise,  at  the  places  hereinafter  named : 
Provided,  That  if  the  Secretary  of  the  Treasury  shall  make  a 
finding  that  any  hospital  project  hereinafter  specifically  author- 
ized is  not  to  the  best  interest  of  the  Government  from  the  stand- 
point of  cost  and  location,  and  of  the  emergency  needs  of  the 
Public  Health  Service,  he  is  hereby  authorized  to  reject  such  pro- 
ject or  projects  and  to  locate,  construct,  or  acquire  hospitals  at 
such  other  locations  as  would  best  subserve  the  interest  of  the 
Government  and  the  emergency  needs  of  the  Public  Health  Serv- 
ice within  the  limits  of  costs  of  such  authorization. 

a.  At  Cook  County,  Illinois,  by  taking  over  the  land  and  execut- 
ing the  contract  for  the  construction  thereon  of  hospital  buildings 
specified  therein  of  a  certain  proposed  contract  executed  by  the 

113 


Shank  Company,  August  thirty-first,  nineteen  hundred  and  eigh- 
teen, and  in  accordance  with  such  contract  and  the  plans  and 
specifications,  identified  in  connection  therewith  August  thirty- 
first,  nineteen  hundred  and  eighteen,  by  the  signature  and  initials 
of  Brigadier  General  R.  C.  Marshall,  junior,  Construction  Division, 
Quartermaster  Department,  United  States  Army,  by  Lieutenant 
Colonel  C.  C.  Wright,  and  the  Shank  Company,  by  George  H. 
Shank,  president,  at  the  cost  stated  therein,  namely,  $2,500,000, 
with  such  changes  in  said  plans  and  specifications  as  may  be 
required  by  the  Secretary  of  the  Treasury  to  adapt  said  specified 
buildings  to  the  needs  and  purposes  of  the  Public  Health  Service, 
at  a  total  limit  of  cost  not  to  exceed  $3,000,000. 

b.  In  carrying  the  foregoing  authorization  into  effect,  the  Secre- 
tary of  the  Treasury  is  authorized  to  execute  the  contract  with 
The   Shank   Company   hereinbefore   specified,   with   such  verbal 
changes  as  are  made  necessary  by  a  change  in  the  contracting 
officers,  and  to  assume  all  obligations  in  said  contract  contained, 
and  to  purchase  materials  and  labor  in  the  open  market,  or  other- 
wise, and  to  employ  laborers  and  mechanics  for  the  construction 
of  such  buildings  and  their  equipment  as  in  his  judgment  shall 
best  meet  the  public  exigencies,  within  the  limits  of  cost  herein 
authorized. 

c.  At  Dawson  Springs,  Kentucky,  on  land  to  be  acquired  by 
gift,  the  necessary  buildings  for  a  sanatorium  having  a  capacity 
of  not  less  than  five  hundred  beds.     The  sum  of  $1,500,000  is 
hereby  authorized  for  the  construction  of  such  sanatorium. 

d.  The  sum  of  $900,000  is  hereby  authorized  for  the  construc- 
tion,  including   site,   of   a   hospital   plant   complete   at   Norfolk, 
Virginia. 

e.  The  sum  of  $550,000  is  hereby  authorized  for  the  construc- 
tion, on  land  owned  by  the  Government,  on  a  site  to  be  selected 
by  the  Secretary  of  the  Treasury  with  the  approval  of  the  Presi- 
dent, of  a  hospital  plant  complete  in  the  District  of  Columbia 
or  vicinity. 

f.  The  sum  of  $190,000  is  hereby  authorized   for  additional 
hospital  accommodations,  including  such  minor  alteration  in  and 
remodeling  of  existing  and  authorized  buildings  as  may  be  neces- 
sary to  economically  adapt  them  to  the  additional  accommoda- 
tions  herein   authorized   for   the   Marine   Hospital   at   Stapleton, 
Staten   Island,   New   York,   the   sum   appropriated   for   additions 
to  said  hospital  by  the  Act  approved  March  twenty-eighth,  nine- 
teen hundred  and  eighteen,  is  authorized  to  be  expended  in  full 
without  the  construction  of  psychiatric  units. 

SEC.  8.  In  carrying  the  foregoing  authorization  into  effect,  all 
new  construction  work  herein  authorized  shall,  as  feasible,  be  of 
fire  resisting  character,  and  the  Secretary  of  the  Treasury  is 
authorized  to  enter  into  contracts  for  the  construction,  equip- 
ment, and  so  forth,  of  such  buildings  on  Government  owned  lands, 
or  lands  acquired  for  such  purpose,  to  purchase  materials  and 
labor  in  the  open  market,  or  otherwise,  and  to  employ  laborers 
and  mechanics  for  the  construction  of  such  buildings  and  their 
equipment  as  in  his  judgment  shall  best  meet  the  public  exigen- 
cies, within  the  limits  of  cost  herein  authorized. 

114 


SEC.  9.  For  the  purpose  of  carrying  the  foregoing  authorization 
into  effect,  there  is  hereby  appropriated,  out  of  any  moneys  in 
the  Treasury  not  otherwise  appropriated,  to  be  immediately 
available  and  remain  available  until  expended,  the  sum  of 
$8,840,000,  and  for  furniture  and  equipment  not  otherwise  pro- 
vided for,  the  sum  of  $210,000;  in  all,  $9,050,000. 

SEC.  10.  And  the  Secretary  of  the  Treasury  is  hereby  author- 
ized, in  his  discretion,  to  employ,  for  service  within  or  without 
the  District  of  Columbia,  without  regard  to  civil-service  laws, 
rules,  and  regulations,  and  to  pay  from  the  sums  hereby  author- 
ized and  appropriated  for  construction  purposes,  at  customary 
rates  of  compensation,  such  additional  technical  and  clerical 
services  as  may  be  necessary,  exclusively  to  aid  in  the  prepara- 
tion of  the  drawings  and  specifications  for  the  above-named  ob- 
jects and  supervision  of  the  execution  thereof  for  traveling  ex- 
penses, and  printing  incident  thereto,  at  a  total  limit  of  cost  for 
such  additional  technical  and  clerical  services  and  traveling 
expenses,  and  so  forth,  of  not  exceeding  $210,000  of  the  above- 
named  limit  of  cost.  All  of  the  above-mentioned  work  shall  be 
under  the  direction  and  supervision  of  the  Surgeon  General  of 
the  Public  Health  Service,  subject  to  the  approval  of  the  Secretary 
of  the  Treasury. 

SEC.  11.  There  is  hereby  appropriated,  out  of  the  moneys  in  the 
Treasury  not  otherwise  appropriated,  for  necessary  personnel, 
including  regular  and  reserve  commissioned  officers  of  the  Public 
Health  Service  and  clerical  help  in  the  District  of  Columbia  and 
elsewhere,  and  maintenance,  hospital  supplies  and  equipment, 
leases,  fuel,  lights,  and  water,  and  freight,  transportation,  and 
travel,  and  reasonable  burial  expenses  (not  exceeding  $100  for 
any  patient  dying  in  hospital),  $785,333  for  the  fiscal  year  ending 
June  thirtieth,  nineteen  hundred  and  nineteen. 

Approved  March  3,  1919. 

[PUBLIC — No.  384 — 66TH  CONGRESS.] 

[H.   R.    15894] 

An  Act  Providing  additional  hospital  facilities  for  patients  of  the  Bureau 
of  War  Risk  Insurance  and  of  the  Federal  Board  for  Vocational  Education, 
Division  of  Rehabilitation,  and  for  other  purposes. 

Be  it  enacted  by  the  Senate  and  House  of  Representatives  of  the 
United  States  of  America  in  Congress  assembled,  That  the  Secre- 
tary of  the  Treasury  is  authorized,  within  the  limits  of  appropria- 
tions made  herein,  to  provide  additional  hospital  and  out-patient 
dispensary  facilities  for  persons  who  served  in  the  World  War 
and  are  now  or  hereafter  may  be  patients  of  the  Bureau  of  War 
Risk  Insurance  or  of  the  Federal  Board  for  Vocational  Education, 
Division  of  Rehabilitation,  (1)  by  purchase,  gift,  or  lease  of  ex- 
isting plants,  (2)  by  construction  on  sites  now  owned  by  the 
Government  or  on  sites  to  be  acquired,  when  approved  by  the 
President,  by  purchase,  condemnation,  gift,  or  otherwise,  or  (3) 
by  such  remodeling  or  extension  of  existing  plants  and  their  equip- 
ment, owned  or  acquired  by  the  United  States  at  places  now 
being  used  or  that  have  been  used  by  the  Public  Health  Service 
for  hospital  purposes,  as  may  be  necessary  economically  to  adapt 

115 


such  plants  to  the  uses  and  purposes  herein  provided.  Such 
hospitals  and  out-patient  dispensary  facilities  shall  include  the 
necessary  buildings,  and  auxiliary  structures,  mechanical  equip- 
ment, approach  work,  roads  and  trackage  facilities  thereto, 
vehicles,  livestock,  furniture,  equipment  and  accessories  and  also 
shall  provide  accommodations  for  officers,  nurses,  and  attending 
personnel,  and  the  Secretary  of  the  Treasury  is  authorized  to  ac- 
cept gifts  or  donations  for  any  of  the  purposes  named  herein; 

The  Secretary  of  the  War  is  authorized  and  directed  to  transfer 
without  charge  to  the  Secretary  of  the  Treasury  for  the  use  of 
the  Public  Health  Service  such  mechanical,  construction,  and 
miscellaneous  material,  hospital  furniture  and  equipment,  hos- 
pital and  medical  supplies,  motor  trucks  and  other  motor-driven 
vehicles,  not  required  by  the  War  Department,  as  may  be  re- 
quired by  the  Public  Health  Service  for  its  hospitals; 

The  Secretary  of  the  Treasury  is  authorized  in  his  discretion 
to  employ  technical  and  clerical  assistants  within  or  without  the 
District  of  Columbia,  without  regard  to  civil-service  laws,  rules, 
and  regulations,  and  to  pay  from  the  sum  herein  appropriated 
for  construction  purposes,  at  customary  rates  of  compensation, 
exclusively  to  aid  in  the  preparation  of  the  plans  and  specifica- 
tions for  the  above-named  objects  and  for  the  supervision  of  the 
execution  thereof,  and  for  traveling  expenses,  field-office  equip- 
ment, and  supplies,  commercial  printing  in  or  out  of  the  District 
of  Columbia,  incident  thereto,  at  a  total  limit  of  cost  for  such 
additional  technical  and  clerical  assistants  and  traveling  ex- 
penses, and  so  forth,  of  not  exceeding  3  per  centum  of  the  limit 
of  cost  for  construction:  Provided,  That  all  of  the  above-men- 
tioned work  shall  be  under  the  direction  and  supervision  of  the 
Secretary  of  the  Treasury; 

In  carrying  out  the  purposes  herein  authorized  the  President 
is  authorized  and  empowered,  in  his  discretion,  to  assign  for  use 
of  the  Public  Health  Service,  under  the  jurisdiction  of  the  Sec- 
retary of  the  Treasury,  such  lands  or  buildings  now  owned  or 
leased  by  the  United  States,  not  including  property  under  the 
jurisdiction  of  the  National  Home  for  Disabled  Volunteer  Soldiers, 
which,  in  his  judgment,  can  be  used  more  efficiently  for  the  care 
of  patients  of  the  Bureau  of  War  Risk  Insurance;  and  the  Secre- 
tary of  the  Treasury  is  authorized  and  directed  to  take  over  im- 
mediately Fort  Mackenzie,  Wyoming,  Fort  Walla  Walla,  Washing- 
ton, and  Fort  Logan  H.  Roots,  Arkansas,  with  all  lands,  buildings, 
and  equipment  belonging  thereto  for  the  uses  contemplated  herein 
and  to  expend  from  the  appropriation  in  the  following  paragraph 
not  to  exceed  $600,000  at  Forts  Mackenzie  and  Walla  Walla,  and 
not  to  exceed  $250,000  at  Fort  Logan  H.  Roots,  for  providing  and 
increasing  hospital  facilities  thereat; 

For  carrying  into  effect  the  preceding  paragraphs  relating  to 
additional  hospital  facilities  there  is  hereby  appropriated  out 
of  any  money  in  the  Treasury  not  otherwise  appropriated,  the  sum 
of  $18,600,000,  to  be  immediately  available  and  to  remain  avail- 
able until  expended,  of  which  sum  not  to  exceed  $6,100,000  shall 
be  used  for  remodeling  or  extending  existing  plants. 

Approved,  March  4,  1921. 

116 


THIS  BOOK  IS  DUE  ON  THE  LAST  DATE 
STAMPED  BELOW 


AN  INITIAL  FINE  OF  25  CENTS 

WILL  BE  ASSESSED  FOR  FAILURE  TO  RETURN 
THIS  BOOK  ON  THE  DATE  DUE.  THE  PENALTY 
WILL  INCREASE  TO  5O  CENTS  ON  THE  FOURTH 
DAY  AND  TO  $!.OO  ON  THE  SEVENTH  DAY 
OVERDUE. 


SEP  25 


LD  21-100m-7,'40  (6936s) 


YC  02757 


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